Recent advances in the study of endophytic bacteria and endophytic fungi in plants and their effects on biological control of plant diseases were reviewed. Endophytes with many varieties are widely distributed and almost exist in all aquatic and terrestrial plants．Now endophytic fungi have been observed in gramineous plants of 80 generas and 290 species and more than 120 species of endophytic bacteria have been found in some agronomic and cash crops in the world. The host plants infected by endophytes usually grow fast, have a strong resistance to adversity and diseases，and are immune to animal attack compared to uninfected plants. Therefore endophytes-infected plants are more competitive than uninfected ones in adverse circumstances．The mechanism whereby endophytes act as biological control agents is that endophytes inhibit pathogen growth by producing antibiotics, hydrolases, plant growth regulators and alkaloids, competing with pathogen for nutrition, enhancing resistance of host plants to diseases and inducing system resistance. The techniques of isolating，screening and detecting endophytes, approaches of controlling plant diseases by endophytes such as artifical inoculation of endophytes to plant，and application of antibiotics produced by endophytes, and utilization of endophytes as vectors in gene engineering were also reviewed. In addition, prospects and problems about endophytes as biological control agents were discussed．Many factors such as ecology, pathology and morphology should be considered in using endophytes as biological agents in the field.