Isolation of fifteen bacterial isolates were carried out from samples of a watering canal at Al Hadady-Damrou, Kafr El-Sheikh Governorate, Egypt, (31.3°N 30.93°E). Isolation was carried out on nitrogen free Ashby's medium. Screening process was achieved based on nitrogenase activity. The more potent bacterial isolate was selected for the subsequent experiments and was tested as a plant growth-promoting rhizobacteria (PGPR). Ultrastructural, cultural, biochemical characteristics and 16S rRNA partial sequence were used for identification and characterization the obtained isolate. The 16S rRNA sequencing results revealed that the nearest bacterial species to our isolate was Achromobacter xylosoxidans, with about 97% matching. Diazotrophic nature of this obtained isolate was confirmed by its ability to produce nitrogenase. Its ability to produce indole acetic acid, gibberellin and solubilize rock phosphate were confirmed through in vitro assay. Tomato inoculation with the obtained A. xylosoxidans under greenhouse conditions, significantly increased the vegetative growth, yield parameters as well as endogenous phytohormones content using with common free diazotrophic PGPR Azotobacter chroococcum as a reference isolate. Data revealed the importance of soil inoculation with the obtained isolate and its role in increasing soil enzymatic activity.