An investigation was undertaken to study the nature and magnitude of heterosis and inbreeding depression in rice for yield components and kernel characters involving 10 parents, 45 F₁s and corresponding F₂s. High degree of heterosis was observed for plant height, productive tillers plant^-1, panicle length, filled grains panicle^-1, test weight and grain yield plant-1, whereas in case of days to 50% flowering, kernel length (KL), kernel breadth (KB) and KL/KB ratio, it was low. Four cross combinations viz., Pakistani Basmati/Mahi Sugandha, Basmati 370/IET 13846, IET 16320/IET13846 and IET13846/Kasturi exhibited higher magnitudes of heterobeltiosis in F₁ coupled with high inbreeding depression in F₂ for grain yield plant-1, indicating predominant role of non-additive gene action in its inheritance. Such high heterosis for grain yield was due to additive heterotic effect of one or more component traits.