Floral organ identity is fundamental to species diversity and reproductive success in plants and is mainly determined by the combinatorial action of MADS homeotic factors. However, despite their conserved roles in specifying floral organ identity, the regulation of MADS transcription factors remains elusive. Here, we show that the rice (Oryza sativa L.) short internode1 (shi1) mutant displays pleiotropic defects in floral organ development, resulting in severe penalties to yield and grain quality. OsSHI1 mRNA accumulates in each floral organ whorl, and OsSHI1 interacts with multiple MADS transcription factors, especially the class E members. This physical interaction occurs through the intrinsic MADS domains, thus regulating the transcriptional activity of the MADS transcription factors. This study provides insight into the molecular and genetic regulatory mechanisms underlying the roles of OsSHI1 and MADS transcription factors in rice floral organ development and, consequently, grain yield and quality.