Phalaenopsis orchids occupy a top position in the international market as pot plant. Commonly used media for growing Phalaenopsis orchid are coconut husk chips, tree bark, fir bark, cocopeat and sphagnum moss. Growing medium is important as it provides anchorage, retains moisture, nutrients and aerates the roots. In addition to these functions, a study was carried out to assess the possible growth promoting effects of sphagnum moss on orchids when used as growing medium. Eight month old hardened plants of Phalaenopsis ‘Magic Kiss’ were used for the trial. They were planted in translucent plastic pots with three different growing media viz., coarse coconut husk chips, cocopeat (fine coconut husk bits) and sphagnum moss in combination with charcoal and tile bits. Plants grown in sphagnum moss were significantly superior to those grown in coconut husk chips and coconut husk bits as media, both in terms of vegetative and floral attributes. Root cross section of sphagnum moss grown plants revealed healthy velamen and their root parenchyma tissues were rich in chlorophyll. From the moss surface, bacterial isolates of Bacillus thuringensis and B. aryabhattai were identified. Endophytic nitrogen fixing bacteria Klebsiella pneumoniae was isolated from leaves and roots grown in moss. Plants grown in moss had no incidence of wilt caused by Fusarium oxysporum. The isolates tested positive for IAA production.