The Phyllanthus genus exhibits a broad distribution spanning across the majority of tropical and subtropical regions. Due to their ability to synthesize medicinal bioactive compounds such as lignans, they have been utilized historically in traditional medicine to treat a wide range of ailments. This review discusses the current knowledge on the potency of lignans for medicinal purposes, the benefit of lignans for plants, various lignans produced by Phyllanthus, and how lignan synthesis could be increased through biotic and abiotic elicitation. Finally, we present a set of connected hypotheses to explain how signaling crosstalk between endophytic microbes and drought stress responses regulates lignan production. Although the mechanisms of lignan synthesis in Phyllanthus are not fully explored, this review strongly supports the view that endophytic fungi and drought stress can increase lignan production in plants belonging to the genus Phyllanthus. The medicinal plant–endophyte–drought stress relationship helps to improve the lignan yield of Phyllanthus, which is crucial for human health and can be optimized under in vitro and in vivo conditions.