Dieback and canker of pistachio shoots and limbs is a commercially significant disease in Iran. Paecilomyces formosus (Sakag., May., Inoue and Tada) Houbraken & Samson is considered as the major causal agent of this malady. Actinomycetes and particularly members of the genus Streptomyces are well known as biocontrol agents for many plant diseases; they achieve this by production of bioactive metabolites and hydrolytic enzymes. The present study aimed to exploit Streptomyces isolates to biologically control P. formosus in vitro and in greenhouse experiments. Fifty two actinomycetes isolates were evaluated for their antagonistic effect against P. formosus isolated from diseased orchards. Considering their in vitro antagonistic performance, two isolates, designated as BH4-1 and BH4-3 were selected for molecular identification and in vivo experiment to be evaluated for biocontrol efficacy. Partial sequences of 16S rDNA unveiled their identity as two strains of Streptomyces misionensis with 99.9% sequence homology. For in vivo greenhouse experiments, inoculation of artificially made wounds on pistachio young trees stems performed with spore suspensions and culture extracts of either of the two bioactive S. misionensis Cercos et al. strains alone and/or together with P. formosus spore suspensions. Cupravit® was used as fungicide control. To evaluate the effect of the biocontrol test agents on the development of disease symptoms and severity, after about nine months, canker severity score, length and width of internal discolored lesions and frequency of P. formosus re-isolation from lesion margins were measured. The recorded disease criteria for treatments receiving S. misionensis strains were significantly in favor of bio-controlling the disease compared to the controls.