Rice yield is greatly affected by environmental stresses such as drought and salinity. In response to the challenge of producing rice plants tolerant to these stresses, we introduced cDNA encoding the transcription factors DREB1A and DREB1B under the control of the stress inducible rd29 promoter. Two different indica rice cultivars were used, BR29, an improved commercially cultivated variety from Bangladesh and IR68899B, an IRRI bred maintainer line for hybrid rice. Agrobacterium mediated transformation of BR29 was done independently with DREB1A isolated from rice and Arabidopsis and DREB1B isolated from rice, whereas biolistic transformation was done with rice- DREB1B in the case of IR68899B. Initial genetic integration was confirmed by PCR and Southern blot analysis. Salinity tolerance was assayed in very young seedlings. Drought stress tests were found to be more reliable when they were carried out at the pre-flowering booting stage. RNA gel blot analysis as well as quantitative PCR analysis was performed to estimate the transcription level under stressed and unstressed conditions. Agronomic performance studies were done with stressed and unstressed plants to compare the yield losses due to dehydration and salt loading stresses. Noticeably enhanced tolerance to dehydration was observed in the plants transformed with DREB1A isolated from Arabidopsis while DREB1B was found to be more effective for salt tolerance. © 2012 The Authors. Plant Biotechnology Journal © 2012 Society for Experimental Biology, Association of Applied Biologists and Blackwell Publishing Ltd.