In this study, strain KNU17Pc1 was tested for its antifungal activity against Rhizoctonia solani AG-1(IA), which causes banded leaf and sheath blight (BLSB) of maize. KNU17Pc1 was tested further for its broad-spectrum antifungal activity and in vitro plant growth promoting (PGP) traits. In addition, the in vivo effects of KNU17Pc1 on reduction of BLSB severity and seedling growth promotion of two maize cultivars under greenhouse conditions were investigated. On the basis of multilocus sequence analysis (MLSA), KNU17Pc1 was confirmed as P. chlororaphis subsp. aurantiaca. The study revealed that KNU17Pc1 had strong in vitro antifungal activity and was effective toward all in vitro PGP traits except phosphate solubilization. In this study, for the first time, a strain of P. chlororaphis against Colletotrichum dematium, Colletotrichum gloeosporioides, Fusarium oxysporum f.sp. melonis, Fusarium subglutinans and Stemphylium lycopersici has been reported. Further biochemical studies showed that KNU17Pc1 was able to produce both types of phenazine derivatives, PCA and 2-OH-PCA. In addition, solid phase microextraction-gas chromatography-mass spectrometry (SPME-GC-MS) analysis identified 13 volatile organic compounds (VOCs) in the TSB culture of KNU17Pc1, 1-undecene being the most abundant volatile. Moreover, for the first time, Octamethylcyclotetrasiloxan (D4), dimethyl disulfide, 2-methyl-1,3-butadiene and 1-undecene were detected in P. chlororaphis. Furthermore, this study reported for the first time the effectiveness of P. chlororaphis to control BLSB of maize. Hence, further studies are necessary to test the effectiveness of KNU17Pc1 under different environmental conditions so that it can be exploited further for biocontrol and plant growth promotion.