Biotic stresses in plants have a significant impact on agricultural productivity. In the present study,
in vivo
experiments were conducted to determine the physiological responses of tomato (
Solanum lycopersicum
L.) seedlings by inoculation with an endophytic actinobacterium,
Streptomyces thermocarboxydus
isolate BPSAC147 under greenhouse conditions. Further, photochemical quantum yield of photosystem II (PSII) (F
v
/F
m
), photochemical quenching (qP) and non-photochemical (NPQ) were calculated in seedlings inoculated with
S
.
thermocarboxydus
(T1) and were compared with control (T0) plants. Furthermore, the electron transport rate (ETR) of PSII exhibited a significant increase in
T1
plants, relative to
T0
plants. These results indicate that inoculation of tomato seedlings with
S
.
thermocarboxydus
had a positive effect on the process of photosynthesis, resulting in enhanced chlorophyll fluorescence parameters due to increased ETR in the thylakoid membrane. GC-MS analysis showed significant differences in the volatile compounds in the different treatments performed under greenhouse conditions. The present study suggests that
S
.
thermocarboxydus
can be used as new biocontrol agent to control
Fusarium
wilt in tomato crops and enhance productivity by enhancing photosynthesis.