The present disclosure discloses method and automated exploratory testing system for performing automated exploratory testing of software applications. The automated exploratory testing system receives test application and data associated with test application, from data sources. The data comprises environment information and goal information. The system identifies defects in components of test application along with corresponding reward value, by performing a plurality of actions on each of components. The plurality of actions is determined based on a predefined machine learning technique and data. The system determines test strategy, by analysing components with defects, plurality of actions corresponding to defects, corresponding reward value and historic test data associated with other applications related to test application. Thereafter, the system performs actions identified from plurality of actions based on test strategy, on components, to identify additional defects in components, for performing automated exploratory testing.
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