Removal of a selectable marker gene from genetically modified (GM) crops alleviates the risk of its release into the environment and hastens the public acceptance of GM crops. Here we report the production of marker-free transgenic rice by using a chemically regulated, Cre/loxP-mediated site-specific DNA recombination in a single transformation. Among 86 independent transgenic lines, ten were found to be marker-free in the T0 generation and an additional 17 lines segregated marker-free transgenic plants in the T1 generation. Molecular and genetic analyses indicated that the DNA recombination and excision in transgenic rice were precise and the marker-free recombinant T-DNA was stable and heritable.