Jasmonic acid (JA) is involved in plant development and the defense response. Transgenic overexpression of the Arabidopsis (Arabidopsis thaliana) jasmonic acid carboxyl methyltransferase gene (AtJMT) linked to the Ubi1 promoter increased levels of methyl jasmonate (MeJA) by 6-fold in young panicles. Grain yield was greatly reduced in Ubi1:AtJMT plants due to a lower numbers of spikelets and lower filling rates than were observed for nontransgenic (NT) controls. Ubi1:AtJMT plants had altered numbers of spikelet organs, including the lemma/palea, lodicule, anther, and pistil. The loss of grain yield and alteration in spikelet organ numbers were reproduced by treating NT plants with exogenous MeJA, indicating that increased levels of MeJA in Ubi1:AtJMT panicles inhibited spikelet development. Interestingly, MeJA levels were increased by 19-fold in young NT panicles upon exposure to drought conditions, resulting in a loss of grain yield that was similar to that observed in Ubi1:AtJMT plants. Levels of abscisic acid (ABA) were increased by 1.9-and 1.4-fold in Ubi1:AtJMT and drought-treated NT panicles, respectively. The ABA increase in Ubi1:AtJMT panicles grown in nondrought conditions suggests that MeJA, rather than drought stress, induces ABA biosynthesis under drought conditions. Using microarray and quantitative polymerase chain reaction analyses, we identified seven genes that were regulated in both Ubi1:AtJMT and drought-treated NT panicles. Two genes, OsJMT1 and OsSDR (for short-chain alcohol dehydrogenase), are involved in MeJA and ABA biosynthesis, respectively, in rice (Oryza sativa). Overall, our results suggest that plants produce MeJA during drought stress, which in turn stimulates the production of ABA, together leading to a loss of grain yield.Rice (Oryza sativa), the model system for the study of monocotyledonous plants, is a cereal crop consumed by more than half of the world's population. As such, improvements in grain yield are an important focus of research. Since rice plants grow in a paddy field, they are susceptible to water stress and in particular to drought (Yang et al., 2004(Yang et al., , 2007. Approximately 20% of the total worldwide rice growing area is prone to drought (Pandey et al., 2007), and drought is one of the major constraints to rice production worldwide. Although drought conditions can alter the growth and development of rice at any time during its life cycle, drought stress during reproductive growth, but not during vegetative growth, results in a loss of grain yield.Immediately following the transition of rice plants to the reproductive phase, the vegetative meristem is converted into the panicle meristem. The panicle meristem subsequently differentiates in an orderly fashion into primary branches, secondary branches, and spikelet meristems (Ikeda et al., 2004). Rice grain yield is determined by four parameters: number of panicles per plant, number of spikelets per panicle, filling rate, and total seed weight. The number of panicles and spikelets is determined soon after for...