The rapid decrease in sequencing cost has enabled genetic studies to discover rare variants associated with complex diseases and traits. Once this association is identified, the next step is to understand the genetic mechanism of rare variants on how the variants influence diseases. Similar to the hypothesis of common variants, rare variants may affect diseases by regulating gene expression, and recently, several studies have identified the effects of rare variants on gene expression using heritability and expression outlier analyses. However, identifying individual genes whose expression is regulated by rare variants has been challenging due to the relatively small sample size of expression quantitative trait loci studies and statistical approaches not optimized to detect the effects of rare variants. In this study, we analyze whole-genome sequencing and RNA-seq data of 681 European individuals collected for the Genotype-Tissue Expression (GTEx) project (v8) to identify individual genes in 49 human tissues whose expression is regulated by rare variants. To improve statistical power, we develop an approach based on a likelihood ratio test that combines effects of multiple rare variants in a nonlinear manner and has higher power than previous approaches. Using GTEx data, we identify many genes regulated by rare variants, and some of them are only regulated by rare variants and not by common variants. We also find that genes regulated by rare variants are enriched for expression outliers and disease-causing genes. These results suggest the regulatory effects of rare variants, which would be important in interpreting associations of rare variants with complex traits.