Tissue culture is a fascinating tool that enables the rapid production of genetically identical, high-yielding, disease-resistant, and long-lasting plants with relatively little use of water, space, materials, and time. Drought is a major abiotic factor limiting crop production worldwide. Orchid species are considered drought sensitive species. The present research work involves the induction of shoots, leaves, callus of orchid species (Vappodes phalaenopsis), and investigated the effects of drought stress on the in vitro growth of orchids. Solid polyethylene glycol (PEG -6000) of high strength (0.5gm/L) was used for drought stress induction in MS. Shoot and leaf induction from explants (shoot tips) showed that Murashige Skoog (MS), 2ml BAP and 1ml NAA were best for shoot initiation and PEG 0.5.gm/litre Murashige Skoog (MS), 2ml BAP and 1ml NAA proved best for callus initiation. PEG reduces transpiration of orchid plants by reducing the number of leaves, shoots, and increases the number of callus. The reverse was true in the medium MS without PEG. Keywords: PEG, tissue culture, drought stress, BAP, NAA.