Ethylene is an essential plant hormone also known as a stress hormone because its synthesis is accelerated by induction of a variety of biotic and abiotic stress. The plant growth promoting bacteria containing the enzyme 1-aminocyclopropane-1-carboxylate (ACC) deaminase enhances plant growth by decreasing plant ethylene levels under stress conditions. The expression of ACC deaminase (acdS) gene in transgenic plants is an alternative approach to overcome the ethylene-induced stress. Several transgenic plants have been engineered to express both bacterial/plant acdS genes which then lowers the stress-induced ethylene levels, thus efficiently combating the deleterious effects of environmental stresses. This review summarizes the current knowledge of various transgenic plants overexpressing microbial and plant acdS genes and their potential under diverse biotic and abiotic stresses. Transcription regulation mechanism of acdS gene from different bacteria, with special emphasis to nitrogen fixing bacteria is also discussed in this review.