The mechanisms of selenium (Se) oxyanion transformation in endophytic bacteria remain poorly understood, which limits their application in biofortification and phytoremediation. Here, we investigated these mechanisms using the plant-growth-promoting (PGP) endophyte Erwinia sp. PSI-03. Under 2 mM selenite stress, the strain intracellularly and extracellularly produced spherical selenium nanoparticles (SeNPs; ab57 nm average diameter). Multi-omics analyses revealed that these SeNPs were formed through parallel enzymatic (mediated by sulfite reductase, cysI) and non-enzymatic (via glutathione and l-cysteine) reduction pathways. Additionally, γ-glutamyl-Se-methylselenocysteine was identified as a key organo-selenium metabolite. Selenite exposure induced extensive reprogramming of the metabolome and transcriptome, highlighting key roles for glutathione metabolism and stress response systems related to cell wall/membrane maintenance, oxidative phosphorylation, two-component signaling systems, and DNA repair. Intriguingly, selenite stress concurrently stimulated bacterial synthesis of PGP compounds, including the auxin precursor indole-3-pyruvate, the defense hormone salicylic acid, and acetate. Consistent with this, under selenite-free and high-selenite (12 mg kg−1 Se) conditions, inoculation with Erwinia sp. PSI-03 significantly promoted tea plant growth. Compared to uninoculated controls, the leaf biomass increased by 52.8% and 51.7%, and the total biomass by 82.9% and 49.6%, respectively. These findings establish a paradigm where endophytic bacteria simultaneously detoxify Se and promote plant health, offering a robust strategy for agricultural and environmental Se management.