Beneficial rhizobacteria were isolated from two different compartments of oil palm roots; the rhizosphere or rhizoplane and the inner root tissues. The root samples were collected from oil palm plantation at Felda Lepar 9, Temerloh Pahang (Block 17, Square 6) (soil pH 4.30; 10:25 0.01M CaCl2). Identification of the isolates was conducted by classical biochemical and physiological tests. Acetylene Reduction Assay (ARA) test was also conducted to quantify the ability of the isolates to fix atmospheric N2. Twenty-nine strains of rhizobacteria were isolated from root samples and were maintained aerobically on N-free solid media. Seven of the isolates were identified as Gram negative while the rest were Gram positive. The isolates were successfully identified as Paenibacillus durus (formerly P. azotofixans), Paenibacillus polymyxa, Azospirillum lipoferum, Herbaspirillum seropedicae and Acetobacter diazotrophicus. The N2 fixation capacities of the isolates ranged from 7.0 x 10-12 to 1.0 x 10-8 mol C2H4/cfu/hour