This project is focused on the development and demonstration of technology to reduce nitrogen fertilizer usage while maintaining yields and increasing resistance to environmental stress. The technology is suitable for areas of intensive agricultural crop production as well as the production of biomass crops on marginal lands for sustainable biofuel and bioenergy production. The development and demonstration of nitrogen fixing endophytic bacteria suited for corn and important agricultural crops provides a means to improve yields while decreasing environmental impacts of soil applied nitrogen fertilizers such as generation of greenhouse gases and negative impacts to surface waters. The interior of many plant species provides habitat for a wide range of bacteria and fungi that benefit the plant host by increasing nutrient acquisition and stress tolerance. The term "endophyte" was coined to describe these internal microbes that spend a significant part of their life cycle within plants and do not cause disease. A subset of these endophytic microorganisms fixes atmospheric nitrogen into the usable forms of ammonia and nitrate within the plant. Such microbes are termed diazotrophs, and have been found in major food crops including rice, maize, sugar cane, and sweet potato. Although diazotrophic endophytes can promote growth by producing phytohormones, it has been demonstrated that significant amounts of fixed nitrogen can be provided by them as well to improve plant growth. Successful completion of this project will demonstrate specific benefits of nitrogen fixing endophytes in larger scale greenhouse and small plot field studies and form the basis for large scale field demonstrations and production in Phase II including manufacture, delivery and application methods compatible with current agriculture production techniques. The development of which will provide farmers with increased profits as nitrogen requirements are decreased. Additional benefits resulting from the overall decreased dependence and usage of nitrogen fertilizer sources will occur in improved water quality and decreased greenhouse gas production.