Xenobiotic exposure refers to introducing foreign substances (drugs, environmental pollutants, food additives, pesticides, and industrial chemicals) into an organism’s body that are not naturally produced or expected to be found in living organisms. Xenobiotics can cause metabolic changes, cellular damage and chromosomal aberration, disrupt cell signaling pathways, and long-term exposure exerts toxicity and increase cancer risk in animal systems. Xenobiotic exposure disrupts microbial community structure and function, reduce microbial diversity, and alter the abundance of beneficial microbes, leading to shifts in species composition. Arbuscular mycorrhizal fungi (AMF) are obligate biotrophs associated symbiotically with almost 70–90% of plant roots. The AMFs colonize in the root regions of the host plant and transport mineral nutrients from soil to plant. In return, the fungus uptakes the required carbon from plants. This nutrient exchange affects the carbon (C) cycle, key soil processes, and plant fitness, significantly influencing microbial and plant ecosystems. AMFs are present in various settings, such as highly disrupted ecosystems with heavily contaminated soils from heavy metals, excessive drought, salt, and xenobiotics. Some AMF species are known to mitigate such stresses and boost plant growth and development. In this book chapter the effect of xenobiotics on the AMF, their diversity, viability in natural soil, and host physio-biochemical impacts will be explored, and to find out the strategies of the application of AMF inoculum for sustainable crop production and maintaining soil biodiversity and improving nutrient cycling under xenobiotic stress.