Endophytic microorganisms live inside plants for at least part of their life cycle. According to their life strategies, bacterial endophytes can be classified as "obligate" or "facultative". Reports that members of the genus Micromonospora, Gram-positive Actinobacteria, are normal occupants of nitrogen-fixing nodules has opened up a question as to what is the ecological role of these bacteria in interactions with nitrogen-fixing plants and whether it is in a process of adaptation from a terrestrial to a facultative endophytic life. The aim of this work was to analyse the genome sequence of Micromonospora lupini Lupac 08 isolated from a nitrogen fixing nodule of the legume Lupinus angustifolius and to identify genomic traits that provide information on this new plant-microbe interaction. The genome of M. lupini contains a diverse array of genes that may help its survival in soil or in plant tissues, while the high number of putative plant degrading enzyme genes identified is quite surprising since this bacterium is not considered a plant-pathogen. Functionality of several of these genes was demonstrated in vitro, showing that Lupac 08 degraded carboxymethylcellulose, starch and xylan. In addition, the production of chitinases detected in vitro, indicates that strain Lupac 08 may also confer protection to the plant. Micromonospora species appears as new candidates in plant-microbe interactions with an important potential in agriculture and biotechnology. The current data strongly suggests that a beneficial effect is produced on the host-plant.