Soil salinity is one of the major abiotic stresses affecting plant productivity. We report on the isolation and characterization of a different isoform of vacuolar Na+/H+ antiporter from Pennisetum glaucum (PgNHX1) that conferred high level of salinity tolerance when over expressed in Brassica juncea. PgNHX1 cDNA has an ORF of 1,413 bp and a 3′ and 5′ UTR of 350 and 166 bp, respectively. In contrast to AtNHX1 and OsNHX1, which have nine transmembrane-spanning domains, PgNHX1 has five transmembrane domains. Real time quantitative RT-PCR analysis revealed up-regulation of PgNHX1 transcript following NaCl and ABA treatments. The 3.3 kb PgNHX1 genomic clone has 12 introns spanning the entire ORF. Confocal imaging of the GFP-PgNHX1 fusion construct showed vacuolar localization in yeast cells. The fungal inhibitor, brefeldin A, inhibited this localization. PgNHX1 functionally complemented yeast mutants defective in endogenous NHX and such transformed yeast could tolerate up to 70 mM NaCl. Transgenic B. juncea plants overexpressing PgNHX1 survive, set flowers and normal seeds in presence of up to 300 mM NaCl. The transgenic plants accumulated more Na+ in the leaves than in seeds. Our data demonstrate the potential of PgNHX1 for imparting enhanced salt tolerance capabilities to salt-sensitive crop plants for growing in high-saline areas.