Verticillium wilt caused by Verticillium dahliae is a threatening disease of cotton, causing economic loss worldwide. In this study, nine endophytic Bacillus strains isolated from cotton roots exhibited inhibitory activity against V. dahliae strain VD-080 in a dual culture assay. B. altitudinis HNH7 and B. velezensis HNH9 were chosen for further experiments based on their high antagonistic activity. The secondary metabolites of HNH7 and HNH9 also inhibited the growth of VD-080. Genetic marker-assisted detection revealed the presence of bacillibactin, surfactin, bacillomycin and fengycin encoding genes in the genome of HNH7 and HNH9 and their corresponding gene products were validated through LC-MS. Scanning electron microscopy revealed mycelial disintegration, curling and shrinkage of VD-080 hyphae after treatment with methanolic extracts of the isolated endophytes. Furthermore, a significant reduction in verticillium wilt severity was noticed in cotton plants treated with HNH7 and HNH9 as compared to control treatments. Moreover, the expression of defense-linked genes, viz., MPK3, GST, SOD, PAL, PPO and HMGR, was considerably higher in plants treated with endophytic Bacillus strains and inoculated with VD-080 as compared to control.