An assessment of the current state of bacterial inoculants for contemporary agriculture in developed and developing countries is critically evaluated from the point of view of their actual status and future use. Special emphasis is given to two new concepts of inoculation, as yet unavailable commercially: (i) synthetic inoculants under development for plant-growth promoting bacteria (PGPB) (Bashan and Holguin, 1998), and (ii) inoculation by groups of associated bacteria.This review contains: A brief historical overview of bacterial inoculants; the rationale for plant inoculation with emphasis on developing countries and semiarid agriculture, and the concept and application of mixed inoculant; discussion of microbial formulation including optimization of carrier-compound characteristics, types of existing carriers for inoculants, traditional formulations, future trends in formulations using unconventional materials, encapsulated synthetic formulations, macro and micro formulations of alginate, encapsulation of beneficial bacteria using other materials, regulation and contamination of commercial inoculants, and examples of modem commercial bacterial inoculants; and a consideration of time constraints and application methods for bacterial inoculants, commercial production, marketing, and the prospects of inoculants in modern agriculture.® 1998 Elsevier Science Inc.