Abscisic acid (ABA) is a key component of many signaling networks mediating plant adaptation to various stresses. In this context, ABA-induced antioxidant defence is considered to be a main mechanism to that enhances water stress tolerance in plants. The specific details of this activation remain, however, elusive. In this work, we show that DIP1, a protein from novel R3H family, played a central role in modulating water stress tolerance in rice. OsDIP1 transcripts were induced by hydrogen peroxide (H2O2), ABA, drought (polyethylene glycol treatment), and salt stress. Overexpression of OsDIP1 in rice enhanced drought and salinity tolerance while knocking out OsDIP1 by CRISPR-Cas9 editing resulted in drought and salt sensitive phenotype. The activity and gene expression of antioxidant defence enzymes, superoxide dismutase (SOD), catalase (CAT), increased in OsDIP1-overexpressed transgenic rice plants, while the content of malondialdehyde (MDA) decreased. In contrast, the content and gene expression of SOD and CAT, decreased, and the content of MDA increased in knockout of OsDIP1 rice plants, suggesting that overexpression of OsDIP1 enhances the antioxidant capacity of rice plants. The yeast two hybrid screening test revealed that OsDIP1 interacted with ZFP36, a key zinc finger transcription factor involved in ABA-induced antioxidant defence. Moreover, OsDIP1 could modulate some key ABA-responsive genes via interacting with ZFP36. Overall, our findings indicate an important role of OsDIP1 in ABA-induced antioxidant defence signaling and adaptation to salinity and drought in rice.