We have identified a unique symbiotic plant-endophyte association in the meristematic tissue of Scots pine buds, where Methylobacterium spp. are the dominant species. These microbes are found in the cells of the apical meristem, needle and scale primordia, and around the resin ducts. Throughout the year they are associated with growing tissues (Pirttilä et al. 2000, 2005). Infection of pine seedlings by the endophytic strain Methylobacterium extorquens sp. DSM13060 induces expression of several PR-like genes, along with genes associated with development and signaling, such as HYL1 and ALE2, a receptor protein kinase, and CYP71. A group of genes associated with development and apoptosis such as AMP1, MERI5, AGL8, COW1, plantacyanin, and chlorophyllase are down-regulated in the M. extorquens -infected seedlings. We have isolated endophytic products that increase viability of pine tissue in vitro (Pirttilä et al. 2004) and characterized some of them as antioxidants. When M. extorquens sp. DSM13060 was tagged with fluorescent proteins expressed by endophyte-specific promoters, the colonization with respect to specific metabolic processes could be observed in Scots pine seedlings. Furthermore, we saw that M. extorquens sp. DSM13060 specifically enters the plant through the plant epiderm by the crack entry and/or active penetration and forms infection pockets, resembling rhizobial infection. Unpublished data indicates that meristem-associated endophytes likely exist in other plant species. The shoot meristems can be considered among the most important tissues of the plant, responsible for growth and development of new leaves and stems. The finding of bacterial endophytes in these tissues suggests that a balanced interaction is essential for their proper function. As endophytes have been occupying the plant interior for more than 400 million years (Krings et al. 2007), mutual evolution must have driven ways to subsist, adapt, and eventually refine the interaction to a balanced state.