Sulfur (S) exists in organically bound complexes (∼95%), predominantly as sulfonates, and are not directly plant available. Specific soil bacteria can mobilise sulfonates but very little is known about these bacteria in the hyphosphere. Since mycorrhizal fungi support growth of the majority of land plants, hyphosphere desulfonating bacteria may be of substantial benefit to the plant host. This study analysed the effect of AM inoculation with Rhizophagus irregularis (former G. intraradices, Glomus) and a mix of six AM species (Mixed) on PGP, microbial communities and sulfonate mobilising bacteria with L. perenne, Agrostis stolonifera and Plantago lanceolata as plant hosts in bi-compartmental microcosms and A. stolonifera in PGP pot experiments. AM inoculation significantly increased plant growth, percentage root colonisation and the quantity of cultivable desulfonating bacteria in the hyphosphere over pre-inoculated soil for all plants. Community analysis via PCR-DGGE revealed significantly different bacterial and fungal communities post inoculation. Analysis of the sulfonate mobilising asfA gene revealed a significantly altered community and novel bacterial isolates with this important functional ability post-inoculation. The results demonstrate that AM inoculation increased plant biomass yield, AM root colonisation and altered bacterial and fungal community dynamics in the hyphosphere. AM inoculated microcosms had an increased abundance of desulfonating bacteria that may be beneficial for plant-S supply.