Ethylene and abscisic acid (ABA) have a complicated interplay in many developmental processes. Their interaction in rice is largely unclear. Here, we characterized a rice ethylene-response mutant mhz4, which exhibited reduced ethylene-response in roots but enhanced ethylene-response in coleoptiles of etiolated seedlings. MHZ4 was identified through map-based cloning and encoded a chloroplast-localized membrane protein homologous to Arabidopsis thaliana (Arabidopsis) ABA4, which is responsible for a branch of ABA biosynthesis. MHZ4 mutation reduced ABA level, but promoted ethylene production. Ethylene induced MHZ4 expression and promoted ABA accumulation in roots. MHZ4 overexpression resulted in enhanced and reduced ethylene response in roots and coleoptiles, respectively. In root, MHZ4-dependent ABA pathway acts at or downstream of ethylene receptors and positively regulates root ethylene response. This ethylene-ABA interaction mode is different from that reported in Arabidopsis, where ethylene-mediated root inhibition is independent of ABA function. In coleoptile, MHZ4-dependent ABA pathway acts at or upstream of OsEIN2 to negatively regulate coleoptile ethylene response, possibly by affecting OsEIN2 expression. At mature stage, mhz4 mutation affects branching and adventitious root formation on stem nodes of higher positions, as well as yield-related traits. Together, our findings reveal a novel mode of interplay between ethylene and ABA in control of rice growth and development.