Drought alone causes more annual loss in crop yield than the sum of all other environmental stresses. There is growing interest in harnessing the potential of stress-resilient PGPR in conferring plant resistance and enhancing crop productivity in drought-affected agroecosystems. A detailed understanding of the complex physiological and biochemical responses will open up the avenues to stress adaptation mechanisms of PGPR communities under drought. It will pave the way for rhizosphere engineering through metabolically engineered PGPR. Therefore, to reveal the physiological and metabolic networks in response to drought-mediated osmotic stress, we performed biochemical analyses and applied untargeted metabolomics to investigate the stress adaptation mechanisms of a PGPR Enterobacter bugendensis WRS7 (Eb WRS7). Drought caused oxidative stress and resulted in slower growth rates in Eb WRS7. However, Eb WRS7 could tolerate drought stress and did not show changes in cell morphology under stress conditions. Overproduction of ROS caused lipid peroxidation (increment in MDA) and eventually activated antioxidant systems and cell signalling cascades, which led to the accumulation of ions (Na+, K+, and Ca2+), osmolytes (proline, exopolysaccharides, betaine, and trehalose), and modulated lipid dynamics of the plasma membranes for osmosensing and osmoregulation, suggesting an osmotic stress adaption mechanism in PGPR Eb WRS7. Finally, GC-MS-based metabolite profiling and deregulated metabolic responses highlighted the role of osmolytes, ions, and intracellular metabolites in regulating Eb WRS7 metabolism. Our results suggest that understanding the role of metabolites and metabolic pathways can be exploited for future metabolic engineering of PGPR and developing bio inoculants for plant growth promotion under drought-affected agroecosystems.