Bayberry is an attractive, nutritious, and popular fruit in China. The plant fungal pathogen Pestalotiopsis versicolor XJ27 is the causative agent of bayberry twig blight disease, which severely affects bayberry production. Traditional control techniques, such as chemical fungicides, are being used to control this disease; however, these techniques cause environmental and health hazards. In this study, we screened sweet potato rhizospheric bacteria with biocontrol potentials against P. versicolor XJ27, the bayberry twig blight pathogen. Ten isolates showed inhibition; Bacillus siamensis S3 and Bacillus tequilensis S5 showed the highest fungal growth inhibition. The antagonistic bacterial culture suspensions of S3 and S5 inhibited the mycelial growth by 82.9% and 76.2%, respectively. Their extracellular culture filtrates had mycelial growth inhibition of 86.8% and 82.2%, respectively. In detached leaf assay, the extracellular culture filtrates of S3 and S5 inhibited the size of the leaf lesion by 82.3% and 76.2%, respectively. SEM and TEM imaging showed a severe hyphal-damaged structure caused by the antagonistic bacteria. The fungal inhibition mechanisms might employ the hydrolytic enzymes and lipopeptides produced by the bacteria. Both the S3 and S5 have chitinase and protease activity; they produce a series of lipopeptides such as surfactin, iturin, and mycosubtilin. Therefore, we can suggest these bacteria as biocontrol agents for bayberry twig blight disease as an alternative to fungicides based upon their attributes of antifungal activity.