The present work was carried out to study the potential of plant rhizosphere associated bacteria for the biocontrol of potato black scurf disease caused by Rhizoctonia solani Khun AG-3. A total of twenty-eight bacteria isolated from diseased and healthy potato plants grown in the soil of Naran and Faisalabad, Pakistan were evaluated for their antagonistic potential. Nine bacterial strains were found to be antagonistic in vitro, reduced the fungal growth and caused the lysis of sclerotia of R. solani in dual culture assay as well as in extracellular metabolite efficacy test. The selected antagonistic strains were further tested for the production and efficacy of volatile and diffusible antibiotics, lytic enzymes and siderophores against R. solani. Selected antagonistic bacteria were also characterized for growth promoting attributes i.e., phosphate solubilization, nitrogen fixation and indole acetic acid production. Biocontrol efficacy and percent yield increase by these antagonists was estimated in greenhouse experiment. Statistical analysis showed that two Pseudomonas spp. StT2 and StS3 were the most effective with 65.1 and 73.9 percent biocontrol efficacy, as well as 87.3 and 98.3 percent yield increase, respectively. Potential antagonistic bacterial strain StS3 showed maximum homology to Pseudomonas sp. as determined by 16S rRNA gene sequencing. These results suggest that bacterial isolates StS3 and StT2 have excellent potential to be used as effective biocontrol agents promoting plant growth with reduced disease incidence.