Drought, salinity and extreme temperature are major adverse environmental factors that limit plant productivity. Sensors initiate a signaling cascade to transmit the signal and activate nuclear transcription factors to induce the expression of specific sets of genes. Ionic and osmotic stress signal transduction triggers the ionic and osmotic homeostasis signaling pathways, detoxification response pathways, and pathways for growth regulation. The ionic stress is signaled via the SOS pathway where an SOS3-SOS2 complex controls the expression and activity of ion transporters. Osmotic stress activates several protein kinases which mediate osmotic homeostasis and/or detoxification responses. Understanding the mechanisms by which plants perceive and transduce the stress signals to initiate adaptive responses is essential for engineering stress-tolerant crop plants. Genetic engineering strategies rely on the transfer of one or several genes that are either involved in signaling and regulatory pathways, or that encode enzymes present in pathways leading to the synthesis of functional and structural protectants, or that encode stresstolerance-conferring proteins. Certain techniques have been described to identify the gene whose expression is differentially regulated in response to various environmental stresses in higher plants. Such methods include differential display- polymerase chain reaction, suppression subtractive hybridization, serial analysis of gene expression, DNA microarray and cDNA-amplified fragment length polymorphism.