Rt Revd Richard Chartres wrote in the Church Times that facial hair "represented a new way to [connect with] the culture of the majority of their parishioners".
Using two bearded vicars in East London - which has a large Bangladeshi Muslim community - as an example, he said: "The of the most energetic priests in East London have recently grown beards of an opulence that would not have disgraced a Victorian sage.
"The clergy of Tower Hamlets are safe from episcopal censure, and their desire to reach out to the culture of the majority of their parishioners can only be applauded."
While Islamic opinions on the beard vary, many Muslims believe the Quran either commands or encourages men to grow a beard if they can.
In the Church, opinions about beards have varied over history. At its least favourable, archdeacons in the Catholic Church during the Middle Ages were ordered to forcibly shave off the beards of priests if necessary.
Rev Adam Atkinson of St Peter's Church Bethnal Green, one of the vicars Rt Revd Chartres referred to in his piece, said that his beard is "an icebreaker" in his ministry.
He told the Daily Telegraph: "St Paul said 'I become all things to all men that by all possible means I might save some'.
"In our area there are three main groups, the poor, the 'cool' and the Muslims, and beards cover at least two groups reasonably well.
"A Muslim friend said 'I will lend you a hat and you can join me on Friday [prayers]'. It was done in a jokey way but it was quite affirming."