This study investigates the role of microbial biostimulants, specifically Plant Growth Promoting Rhizobacteria (PGPR), in enhancing the drought tolerance of *Arachis hypogaea* L. (groundnut). Fifteen bacterial isolates were screened for their ability to produce plant growth-promoting (PGP) attributes such as phosphate solubilization, indole-3-acetic acid (IAA) production, siderophore production, hydrogen cyanide (HCN) production, ammonia production, and exopolysaccharide (EPS) production. Two strains, *Acinetobacter calcoaceticus* AC06 and *Bacillus amyloliquefaciens* BA01, were identified as having the highest PGP traits and osmotic tolerance. These strains produced significant amounts of osmolytes like proline, salicylic acid, trehalose, and glycine betaine under osmotic stress. In a pot experiment, these strains were inoculated into groundnut plants under mild and severe drought conditions (60% and 40% Field Capacity, respectively). The results showed that inoculation with AC06 and BA01 significantly improved plant growth parameters, relative water content, electrolyte leakage, membrane stability index, chlorophyll content, and carotenoid content. Additionally, the strains enhanced the production of antioxidant enzymes such as catalase, ascorbate peroxidase, and superoxide dismutase. The study concludes that AC06 and BA01 can be effective microbial biostimulants in improving groundnut's drought tolerance by producing osmolytes and inducing metabolic changes.This study investigates the role of microbial biostimulants, specifically Plant Growth Promoting Rhizobacteria (PGPR), in enhancing the drought tolerance of *Arachis hypogaea* L. (groundnut). Fifteen bacterial isolates were screened for their ability to produce plant growth-promoting (PGP) attributes such as phosphate solubilization, indole-3-acetic acid (IAA) production, siderophore production, hydrogen cyanide (HCN) production, ammonia production, and exopolysaccharide (EPS) production. Two strains, *Acinetobacter calcoaceticus* AC06 and *Bacillus amyloliquefaciens* BA01, were identified as having the highest PGP traits and osmotic tolerance. These strains produced significant amounts of osmolytes like proline, salicylic acid, trehalose, and glycine betaine under osmotic stress. In a pot experiment, these strains were inoculated into groundnut plants under mild and severe drought conditions (60% and 40% Field Capacity, respectively). The results showed that inoculation with AC06 and BA01 significantly improved plant growth parameters, relative water content, electrolyte leakage, membrane stability index, chlorophyll content, and carotenoid content. Additionally, the strains enhanced the production of antioxidant enzymes such as catalase, ascorbate peroxidase, and superoxide dismutase. The study concludes that AC06 and BA01 can be effective microbial biostimulants in improving groundnut's drought tolerance by producing osmolytes and inducing metabolic changes.