The study is focused to establish an improved salt and drought tolerant Picrohiza kurroa Royle ex Benth, an endangered medicinal plant of Western Himalayas through mutagenesis system in conjunction with in-vitro regeneration technique. Regeneration using leaf as explants from mature plant of characterized germplasm is beneficial because the source plant is not damaged. Efficient callus formation i.e., 85% was achieved in modified MS medium at 2,4-D at 3.5 mg L -1 . Ethyl methane sulfonate (EMS) a chemical mutagen was used to induce mutation in the callus biomass under in-vitro condition. Relatively decreases in callus biomass were observed as the dose of mutagenic chemical increased from 0.0 to 0.8 mM. Selection of mutants callus lines were also investigated against salt (NaCl) and drought (mannitol) tolerance level by using its various concentrations i.e., 50 to 250 mM L -1 . In mutagenized callus (MC) under both stress responses there was increase in callus biomass with the successive increase in concentration of NaCl and Mannitol till 100 mM L -1 , after that it started decline. Stress tolerated mutant callus line were also characterized by the accumulation of proline and glycine betaine (GB) content. At 100 mM L -1 concentrations of NaCl and mannitol, higher proline and GB content were accumulated in the mutagenized callus i.e., 5.23 and 5.18 μmol g -1 FW and 11.23 and 11.98 μg g -1 FW respectively which is significantly higher in comparison to non-mutagenized callus (UM). For shoot proliferation in mutant callus line, various concentrations with combination of plant growth regulators (PGR's) were used in treatments (T1, T2 and T3). Invariably, in treatment T3 the concentration of 1.0+0.5 mg L -1 resulted in highest shoot regeneration i.e., 85% while minimum 20% was obtained in T1 at concentration 0.5+0.1 mg L -1 . NAA fortified MS medium was found superior to IAA and IBA with respect to the induction of roots. The mutant and stress selected grown through tissue engineering were evaluated for their ex situ agronomic performance in saline as well as drought condition for 30 days. Under both stress condition the mutant plant revealed a remarkable increase in all the parameters studied i.e., shoot and root length, fresh and dry root, shoot biomass and number of leaves with respect to normal plant (control).