Drought is an important factor limiting plant development and crop production. Dissecting the factors involved in this process is the key for enhancement of plant tolerance to drought stress by genetic approach. Here, we evaluated the regulatory function of a novel rice ethylene response factor (ERF) OsERF109 in drought stress. Expression of OsERF109 was rapidly induced by stress and phytohormones. Subcellular localization and transactivation assay demonstrated that OsERF109 was localized in nucleus and possessed transactivation activity. Transgenic plants overexpressing (OE) and knockdown with RNA interfering (RI) OsERF109 exhibited significantly reduced and improved drought resistance, respectively, indicating that OsERF109 negatively regulates drought resistance in rice. Furthermore, measurement by gas chromatography showed that ethylene contents were less in OE while more in RI lines than these in wild types, supporting the data of drought tolerance and water loss in transgenic lines. Quantitative real-time PCR analysis also proved the regulation of OsERF109 in the expression of OSACS6, OSACO2, and OsERF3, which have been identified to play important roles in ethylene biosynthesis. Based on these results, our data evidence that OsERF109 regulates drought resistance by affecting the ethylene biosynthesis in rice. Overall, our study reveals the negative role of OsERF109 in ethylene biosynthesis and drought tolerance in rice.