Endophytism is the phenomenon of mutualistic association of a plant with a microorganism wherein the microbe lives within the tissues of the plant without causing any symptoms of disease. In addition to being a treasured biological resource, endophytes play diverse indispensable functions in nature for plant growth, development, stress tolerance, and adaptation. Our understanding of endophytism and its ecological aspects are overtly limited, and we have only recently started to appreciate its essence. Endophytes may impact plant biology through the production of diverse chemical entities including, but not limited to, plant growth hormones and by modulating the gene expression of defense and other secondary metabolic pathways of the host. Studies have shown differential recruitment of endophytes in endophytic populations of plants growing in the same locations, indicating host specificity and that endophytes evolve in a coordinated fashion with the host plants. Endophytic technology can be employed for the efficient production of agricultural and economically important plants and plant products. The rational application of endophytes to manipulate the microbiota, intimately associated with plants, can help in enhancement of production of agricultural produce, increased production of key metabolites in medicinal and aromatic plants, as well as adaption to new bio-geographic regions through tolerance to various biotic and abiotic conditions. However, the potential of endophytic biology can be judiciously harnessed only when we obtain insight into the molecular mechanism of this unique mutualistic relationship. In this paper, we present a discussion on endophytes, endophytism, their significance, and diverse functions in nature as unraveled by the latest research to understand this universal natural phenomenon.