ABSTRACT Alfalfa (Medicago sativa L. subsp. sativa) has emerged as an alternative crop for Mediterranean dryland areas in Chile. These soils show deficient nutritional levels affecting legume nodulation and N fixation through symbiosis with Ensifer meliloti. The objective of this work was to select plant growth promoting rhizobacteria (PGPR) associated with alfalfa and to evaluate their effects in plant growth and nodulation. Bacterial strains were isolated from the rhizosphere of alfalfa cultivated in dryland soil in Mediterranean areas of Chile. The 1-aminocyclopropane-1-carboxylic acid (ACC) deaminase activity, production of indole acetic acid (IAA), phosphate solubilization and the compatibility with E. meliloti was assessed for each strain. The selected bacterial strains were identified by the amplification of the 16S rRNA gene. Twelve of the 32 isolated strains were compatible with E. meliloti as they did not show signs of antagonism. Eight strains solubilized phosphate, 12 produced IAA ranging from 13.71 to 26.22 mg L-1 and only the GN-8 isolate reported ACC deaminase activity. In the plants, the nodulation was greater when the strain with ACC deaminase and E. meliloti were co-inoculated both in laboratory and greenhouse conditions (P < 0.05). The selected bacteria GN-2 and GN-8 belonged to the genus Bacillus, while GN-4 to Pseudomonas. In conclusion, PGPR collected in marginal soils of Mediterranean areas of Chile showed ACC deaminase activity, IAA production and phosphate solubilization. The co-inoculation with E. meliloti and Bacillus sp. GN-8 allowed earlier nodulation in alfalfa.