Paeonia ostii, a plant of substantial economic significance, continues to face constraints in achieving large-scale propagation. In vitro propagation offers a promising avenue for the production of disease-free plants and the genetic transformation of peonies to instill novel traits. However, significant challenges persist in tissue culture, particularly with regards to the reproduction coefficient of shoots and the rooting process. This study reports an efficacious protocol for P. ostii micropropagation, focusing on in vitro root development facilitated through the application of phloroglucinol (PG). Furthermore, the study unveils the molecular signature of P. ostii during in vitro root development. The results indicate that the modified Y3 medium (Y3M), supplemented with 1 mg/L 6-benzyladenine (BA) and 0.1 mg/L α-naphthaleneacetic acid (NAA), is optimal for adventitious bud induction, achieving a 96.67% induction rate and an average of 16.03 adventitious shoots per sample. The highest elongation percentage (92.15%) and the longest average shoot length (3.87 cm) were obtained with Y3M containing 0.3 mg/L BA and 0.03 mg/L NAA. Additionally, the optimal medium for inducing root formation in P. ostii was identified as WPM supplemented with 3 mg/L indole-3-butyric acid (IBA) and 100 mg/L phloroglucinol (PG). Lignin content detection, microscope inspection, and molecular signature results demonstrated that PG enhanced lignin biosynthesis, thereby promoting in vitro rooting of P. ostii.