A field experiment was conducted at Horticulture Farm, Rajasthan College of Agriculture, Udaipur (Raj.) in the year 2001 to study the effect of levels and methods of inoculation of biofertilizers on growth and yield of chilli. The experiment was laid in a randomized block design-factorial. The two biofertilizers namely Azotobacter chrococum and Bacillus megaterium var. phosphaticum were applied in three doses viz.500 g/ha, 1000 g/ha and 1500 g/ha. Three methods were used viz. nursery application, dipping of seedling at transplanting for 60 minutes and nursery application + dipping of seedling for 60 minutes. The application of biofertilizers significantly increased the plant height, dry matter, plant spread and yield of chilli over the control. The maximum plant height, dry matter and plant spread of chilli was recorded with the application of culture @1500 g per ha. Nursery + dipping method was the best method and recorded maximum plant height, plant spread, dry matter and yield of chilli