There are thirteen species of Aquilaria producing agarwood, a product of plant and microbe interaction. The process of natural formation of agarwood is slow and only 10 percent of the trees in wild get infected forming agarwood. Since commercial cultivation of agarwood has begun, there is a need for a supporting programme of artificial induction to make the programme viable. The paper reviews the methods of biological induction in Aquilaria sp., the role of endophytes especially species of Fusarium and the availability of inocula for inducing agarwood formation.