Actinomycetes are a major group of beneficial microbes, which can be explored as spanking alternative to chemical fungicides for providing defense against phytopathogens. Rhizoctonia solani is a major havoc causing severe loss to many crops. Biological measures for fungal disease management are desired over the available chemical/synthetic fungicides owing to their safety towards nontarget organisms. In the present study, 34 actinomycetes were isolated from vermicompost. Out of them, twelve revealed antifungal activity related to Indole acetic acid (IAA) production, siderophores and plant growth promotion. Under greenhouse and field conditions, these potent strains remarkably enhanced yield attributes and disease diminution as compared to untreated control. A significant disease reduction of 47-63 % against R. solani was observed in tomato plants pretreated with actinomycetes. Furthermore, induction in defense related enzymes such as peroxidase, polyphenol oxidase, phenylalanine ammonia lyase, accumulation of phenolics and flavonoids were also observed in actinomycetes treated plants. Morphological and molecular characterization analysis identified these potent isolates as Streptomyces sp. NBM3, Streptomyces sp. NBM2, Streptomyces sp. NBM1, Streptomyces sp. NBM12 and Streptomyces sp. NBM8. The present findings suggest that these microbes can be utilized for significant enhancement of plant growth and augmentation of defense related enzymes in order to cope up with R. solani induced stress, thereby contributing to crop health.