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Drought stress is a serious limiting factor to rice production, which results in huge economic losses. It is becoming a more serious issue with respect to the global climate change. Keeping in view of the current and forecasted global food demand, it has become essential to enhance the crop productivity on the drought-prone rainfed lands with priority. In order to achieve the production target from rainfed areas, there is a requirement of rice varieties with drought tolerance, and genetic improvement for drought tolerant should be a high priority theme of research in the future. Breeding for drought tolerant rice varieties is a thought-provoking task because of the complex nature and multigenic control of drought tolerant traits would be a major bottleneck for the current research. A great progress has been made during last two decades in our understanding of the mechanisms involved in adaptation and tolerance to drought stress in rice. In this review, we highlighted the recent progresses in physiological, biochemical and molecular adaptation of rice to drought tolerance. A brief discussion on the molecular genetics and breeding approaches for drought tolerance in rice will be focused for the future crop improvement program for development of drought tolerant rice varieties.