Sugarcane plant is a glycophyte, hence its growth and sucrose contents are severely affected by drought and salinity stresses. Bioengineering approaches offer a plausible and rapid solution to mitigate these losses. Therefore for genetic improvement of sugarcane against these stresses, the present study was conceived to transform Arabidopsis Vacuolar Pyrophosphatase (AVP1) gene--confers tolerance against drought and salinity--into sugarcane through Agrobacterium. For this purpose, highly regenerable apical buds of sugarcane variety CP77-400 were used as explants. EHA105 strain of Agrobacterium harboring pGreen0029 vector containing AVP1 gene driven under 35SCaMV promoter was employed for transformation. The key factors studied include application of acetosyringone, cefotaxime, kanamycin, and co-cultivation period for successful transformation. Maximum regeneration frequency of 77.5 % was achieved on MS media containing 1 mg/l BAP, 1 mg/l Kn, 1 mg/l GA₃, 0.25 mg/l NAA, 50 μM acetosyringone, 500 mg/l cefotaxime, and 150 mg/l kanamycin on 3 days of co-cultivation. The results revealed that apical buds are distinctive viable tissues for sugarcane transformation and regeneration to produce a large number of CP77-400 transgenic plants in shorter period of time without intervening mosaics and chimeras. The AVP1 transcripts expression in transgenic lines at various levels was detected by RT-PCR. Longer and profuse root system was observed in transgenic plants in comparison with control plants. Concomitantly, only transgenic plants were able to withstand higher NaCl salt stress as well as scarcity of water thus, showing tolerance against salinity and drought stresses.