A high-quality rice activation tagging population has been developed and screened for drought-tolerant lines using various water stress assays. One drought-tolerant line activated two rice glutamate receptor-like genes. Transgenic overexpression of the rice glutamate receptor-like genes conferred drought tolerance to rice and Arabidopsis. Rice (Oryza sativa) is a multi-billion dollar crop grown in more than one hundred countries, as well as a useful functional genetic tool for trait discovery. We have developed a population of more than 200,000 activation-tagged rice lines for use in forward genetic screens to identify genes that improve drought tolerance and other traits that improve yield and agronomic productivity. The population has an expected coverage of more than 90 % of rice genes. About 80 % of the lines have a single T-DNA insertion locus and this molecular feature simplifies gene identification. One of the lines identified in our screens, AH01486, exhibits improved drought tolerance. The AH01486 T-DNA locus is located in a region with two glutamate receptor-like genes. Constitutive overexpression of either glutamate receptor-like gene significantly enhances the drought tolerance of rice and Arabidopsis, thus revealing a novel function of this important gene family in plant biology.