An experiment in pots was conducted at Sultanpur,U.P., on a fine loamy, mixed, hyperthermic, highly sodic soil having pH (10.5), electrical conductivity (2.42 dS m-1), exchangeable sodium percentage (89.0), organic carbon (0.80gkg-1) and available nitrogen (94kgha-1) to determine the response of two rice (Oryza sativa L.) varieties (Usar dhan 3 and Pant 10) to different gypsum levels [(control, 13, 23 and 52 % gypsum requirement (GR value)]. The study revealed that all the growth parameters (plant height, number of tillers, dry matter accumulation, number of leaves/hills, leaf weight/hill and leaf area index), yield attributes (length of panicle, number of grains/panicles, test weight) and yields (biological yield, straw yield and grain yield) significantly increased with increasing doses of gypsum. Application of gypsum at 52% GR (15.4 t ha-1) was significantly superior over the control and 13% GR doses but at par with that of 23% GR. Significant reduction in soil pH (10.50 to 8.91), EC (1.43to0.48dSm-1) and ESP (89 to 28.5) and increment in OC (0.8to1.2gkg-1) and available N (94to190kgha-1) were recorded after three years of study with 52% GR level. Grain quality of rice in terms of N content in grain, grain length, length: breadth ratio, brown rice recovery, milled rice recovery, head rice recovery and gel consistency were higher with 52%GR as compared to control but statistically at par with that of 23%GR. There were significant varieties×gypsum interactions on number of effective tillers, dry matter accumulation, number of leaves/hills, leaf weight, number of panicles m-2, length of panicle, number of grains/panicles, test weight and grain yield indicating that the varieties responded to gypsum differently. Variety ‘Usardhan 3’ showed significant increase over ‘Pant 10’ in all the growth parameters and yield attributes.