Endophytes exhibit a complex web of interactions with host plants and with other endophytic microorganisms and therefore they have been intensively studied over the last several years as prolific sources of new and bioactive natural products. In fact, an impressive number of natural products have been produced by endophytic microorganisms. In addition, some studies have shown endophytes to be good producers of useful enzymes to improve industrial processes. More recently, endophytes have also received attention as biocatalysts in the chemical transformation of natural products and drugs. Results have shown their ability to modify chemical structures with a high degree of stereospecificity. Some reactions are similar to those catalyzed by mammal phase I metabolism; therefore endophytes could be used as models for drug metabolism studies. This paper summarizes recent data on endophytes research as a source of novel and bioactive natural products, as producers of enzymes and their use on biotransformation processes.