Sesbania rostrata is a native legume species of West Africa that grows well on waterlogged soils and exhibits high N2-fixing potential due to double nodulation (stem and root nodules) even in the presence of soil N. Vesicular-arbuscular mycorrhizal (VAM) fungi can improve productivity in agriculture reducing the reliance on P fertilizer. Experiments have been carried out to evaluate the response of rice (BR3) to S. rostrata green manure as compared to 15N urea fertilizer. The effect of inoculation with Glomus mosseae on the growth of S. rostrata and on rice under flooded and dryland conditions was also measured. Results showed that soil pH 6.0 and addition of P provided optimum conditions for the growth, dry matter yield of and N fixation by S. rostrata in a pot experiment. Dual inoculation with Azorhizobium caulinodans and Glomus mosseae of S. rostrata gave higher N yields. Though A. caulinodans is the specific organism, there are Rhizobium bacteria such as strain 446, RCR 3824 and ARG 2C, with equal potential to enhance the growth of and N accumulation in S. rostrata. Leaf material applied to soil decomposed more quickly than stem and root material. Dry matter yield of shoots of rice did not differ significantly when either S. rostrata green manure or urea were applied but N concentrations differed at first harvest. Recovery of 15N in shoots of rice from urea-N was more than twice (46%) than from green manure-N (21%) at first harvest. Dry matter yield of shoots was significantly higher from S. rostrata green manure-N treatment at second harvest. At the second harvest, total recovery [shoots + roots] of 15N amounted to 65.5 -74.0% for S. rostrata and 23.2% for urea treatments. Growth and dry matter yield of rice were significantly higher in vesicular-arbuscular mycorrhiza (VAM) inoculated pots than uninoculated ones regardless of soil pH under dryland conditions. No mycorrhizal infections were found in the roots of plants grown under flooded conditions. Mycorrhizal infections increased with increasing soil pH under dryland conditions. No tillers were produced on soil which had not received VAM inoculum.