Salinity stress deleteriously affects the growth and yield of many plants. Plant growth promoting rhizobacteria (PGPR) and chitosan both play an important role in combating salinity stress and improving plant growth under adverse environmental conditions. The present study aimed to evaluate the impacts of PGPR and chitosan on the growth of sweet pepper plant grown under different salinity regimes. For this purpose, two pot experiments were conducted in 2019 and 2020 to evaluate the role of PGPR (Bacillus thuringiensis MH161336 106–8 CFU/cm3) applied as seed treatment and foliar application of chitosan (30 mg dm−3) on sweet pepper plants (cv. Yolo Wonder) under two salinity concentrations (34 and 68 mM). Our findings revealed that, the chlorophyll fluorescence parameter (Fv/Fm ratio), chlorophyll a and b concentrations, relative water content (RWC), and fruit yield characters were negatively affected and significantly reduced under salinity conditions. The higher concentration was more harmful. Nevertheless, electrolyte leakage, lipid peroxidation, hydrogen peroxide (H2O2), and superoxide (O2−) significantly increased in stressed plants. However, the application of B. thuringiensis and chitosan led to improved plant growth and resulted in a significant increase in RWC, chlorophyll content, chlorophyll fluorescence parameter (Fv/Fm ratio), and fruit yield. Conversely, lipid peroxidation, electrolyte leakage, O2−, and H2O2 were significantly reduced in stressed plants. Also, B. thuringiensis and chitosan application regulated the proline accumulation and enzyme activity, as well as increased the number of fruit plant−1, fruit fresh weight plant−1, and total fruit yield of sweet pepper grown under saline conditions.