Endophytic SR-15, SR-25 and SL-37 strains screened from rice hybrid D you 527 in Sichuan were analyzed. Through penetration and microscopic test, the strains were found be mainly located in the cell gap, vacuole and cytoplasm. PUC18 transferring and ERIC-PCR showed that the recombination strain SR-15 could grow in the plant stably. The strain was identified as Bacillus halmapalus based on its chemical components of cell wall, physiological and biochemical characters. It was also shown that the strain was not injurious to rice plant, instead, it promoted rice plant growth by penetration. The Cry1Ac gene was transferred into the stain and verified by Southern analysis. Cry1Ac-transferred SR-15 was toxic to the Chilo suppressalis, brought about death ratio as high as 84.2%.