Nitrogen (N) is a major limiting factor affecting crop yield in unfertilized soil. Thus, cultivars with a high N use efficiency (NUE) and good grain protein content (GPC) are needed to fulfill the growing food demand and to reduce environmental burden. This is especially true for rice (Oryza sativa L.) that is cultivated with a high input of N fertilizer and is a primary staple food crop for more than half of the global population. Here, we report that rice asparagine synthetase 1 (OsASN1) is required for grain yield and grain protein contents under both N-sufficient (conventional paddy fields) and N-limiting conditions from analyses of knockout mutant plants. In addition, we show that overexpression (OX) of OsASN1 results in better nitrogen uptake and assimilation, and increased tolerance to N limitation at the seedling stage. Under field conditions, the OsASN1 OX rice plants produced grains with increased N and protein contents without yield reduction compared to wild-type (WT) rice. Under N-limited conditions, the OX plants displayed increased grain yield and protein content with enhanced photosynthetic activity compared to WT rice. Thus, OsASN1 can be an effective target gene for the development of rice cultivars with higher grain protein content, NUE, and grain yield under N-limiting conditions.