Salinity is a major abiotic stress affecting plant growth and productivity worldwide. The salinity-induced reduction in growth and development of plants is associated with ionic/osmotic effects, nutritional imbalance or oxidative stress. Chillies are sensitive to salinity and its growth reduction is reported in developing countries. Different germination and pot trials were conducted to identify morphological, chemical and bio-chemical attributes that can be used for characterization of salinity tolerance in chilli genotypes. In first experiment, 10 Chilli genotypes were screened out for salinity tolerance. One salt sensitive and one salt tolerant genotypes were selected on the basis of morphological and chemical attributes (germination percentage, shoot length, root length, plant fresh weight, plant dry weight and leaf sodium and potassium contents). Then, effects of different salinity levels were assessed on morpho-physiological, chemical, biochemical and enzymatic attributes of salt tolerant and salt sensitive chilli genotypes. With the increase in salt stress, the antioxidant enzymatic activity was increased in both genotypes but higher enzymatic activity was noted at 5.0 and 7.0 dS m-1 salt stress in salt tolerant genotype Plahi. In the third experiment, both genotypes were tested for phospholipid signaling under salt stress and both showed increasing pattern of PIP2 and PIP responses and again maximum signaling response was observed for the salt tolerant genotype Plahi. There was an optimization experiment to find out the best proline dose that could alleviate the salinity induced affects in chilli plants. With the application of different levels of foliar proline, all growth attributes increased but maximum increase was recorded at 0.8 mM proline level. Then foliar spray of the best proline dose 0.8 mM was applied to both genotypes under salt stress of 5 dS m-1. There was significant increase in compatible solutes (proline and glycinebetaine), enzymatic activity, photosynthetic rate and stomatal conductance by proline application under salt stress. There was significant decrease in toxic ions (Na+ and Cl-) and increase in K+ concentration while maximum decrease in Na+ and Cl- contents was observed in salt tolerant genotype Plahi relative to the salt sensitive genotype A-120. Hence, this study implies that proline application is a useful tool to combat salinity stress in chilli genotypes