Slow decline disease caused by Tylenchulus semipenetrans is a major threat to global citrus production. Identification of suitable bio-agents that can be applied through a drip irrigation system by growers becomes inevitable for successful citrus production. Hence, field experiments were conducted to evaluate the effect of different liquid bio-inoculants, such as Bacillus subtilis, Purpureocillium lilacinum, and Trichoderma viride delivered through drip irrigation system on acid lime trees naturally infected with T. semipenetrans. They were applied at 4 L/ha, and their effect was compared with that of the spot application of carbofuran 3G at 100 g per tree. All tested bio-inoculants substantially suppressed the population density of T. semipenetrans in soil and acid lime roots. Among the bio-inoculants, P. lilacinum with 54.9–74.4% and 53.4–74.3% reductions in population in soil and root, respectively, performed best, followed by B. subtilis and T. viride. The effect of P. lilacinum was comparable to that of the chemical standard check carbofuran in location I, but P. lilacinum surpassed carbofuran in location II. Survival in soil and colonization on acid lime roots by P. lilacinum was higher than by B. subtilis and T. viride. The egg mass parasitization by P. lilacinum was also 7.1–7.5 times higher than by T. viride. The suppression of T. semipenetrans by P. lilacinum led to an increase in the number of fruits (19.0–23.3%), fruit weight (20.2–22.3%), and fruit yield (35.4–40.3%) in acid lime trees. The cost–benefit ratio by P. lilacinum was also higher (1: 2.6–1: 3.0), whereas it was lower in carbofuran treatment (1: 2.3—1: 2.4). It is concluded that the delivery of liquid P. lilacinum at 4 L/ha through a drip irrigation system was highly effective and economical for the management of acid lime trees infected with T. semipenetrans under field conditions. [ABSTRACT FROM AUTHOR]