The dry-raised seedlings (D-RS)of rice had obvious superiority in tillering and growth after transplanting. Especially under the condition of water-saving irrigation or low soil moisture, D-RS had more productive tillers, higher dry matter accumulation, larger grain-filling rate, slower senescence of leaves and stronger root activity during ripening, and higher grain yield, compared with the moist-raised seedlings (MRS). D-RS had smaller yield reduction than M-RS when subject to heavy water stress. The results suggested that D-RS had the ability to adapt to lower soil moisture in paddy field. Basedon the response of D-RS to soil moisture at each growth stage, the water-saving and high-yielding irrigation indices through controlling lowlimit soil water potential were proposed, i.e. soil water potential was - 15 - - 20 kPa from the recovery to the criticalleaf-age of productive tillering, - 20 - - 40 kPa from the critical leaf-age of productive tillering to secondary branch-differentiating stage, - 15 - - 25 kPa from secondary branch-differentiating stage to 20 days after heading and - 25 - - 35 kPa from 21 to 45 days after heading.