False smut caused by the flower-infecting fungus, Ustilaginoidea virens has become an important disease of rice seriously hampering production worldwide. An experiment on the eco-friendly method of biological control of false smut was conducted both in vitro and in field conditions to evaluate the ability of biocontrol agents to control the disease. The in vitro evaluation revealed maximum inhibition of U. virens by Trichoderma harzianum (66.88%) followed by Trichoderma atroviride (51.16%), Dendryphiella sp. (41.50%), Bacillus amyloliquefaciens (36.56%) and Bacillus subtilis (36.40%). The mechanisms of action observed during in vitro tests for T. harzianum and T. atroviride were parasitism and production of volatile metabolites. Whereas B. subtilis produced volatile metabolites to control U. virens. All the plants treated with biocontrol agents showed reduced disease incidence relative to the control demonstrating their ability to suppress false smut under field conditions. Besides disease suppression, the biocontrol agents were found to be beneficial to rice as evident from the increased number of grains per panicle in treated plants. Moreover, the chaffiness that reduces rice production, was much lower in all treatments except for plants treated with Dendryphiella sp. Therefore, B. subtilis and T. harzianum have maximum potential to control false smut of rice.