Acetobacter is an obligatory aerobic nitrogen fixing bacteria which is capable for nitrogen fixing in roots, stems and leaves of sugarcane plants. It produces growth promoting substances as IAA (Indole Acetic Acid) and GA (Gibberellic acid) that promote root proliferation and increase the number of rootlets, resulting in uptake of mineral, phosphate solubilisation and water which promote cane growth and sugar recovery in the cane. While all nitrogen bacteria contain nitrogenous in order to utilize atmospheric nitrogen gas as a source of metabolic bio-synthesis, different nitrogen fixing microorganism and protect the oxygen – sensitive microorganism oxygen in different ways. Acetobacter has symbiotic relationship with many different plants like sugarcane and coffee by colonizing their internal tissues to promote the plant growth. Acetobacter diazotrophicus, apparently responsible for this Nitrogen fixation associated with the plants, has unique physiological properties for a diazotroph, such as tolerance to low pH, and high sugar and salt concentrations, lack of nitrate reductase, and nitrogenase activity which tolerates short term exposure to ammonia.