Cyclophilins are a set of ubiquitous proteins present in all subcellular compartments, involved in a wide variety of cellular processes. Comparative bioinformatics analysis of the rice and Arabidopsis genomes led us to identify novel putative cyclophilin gene family members in both the genomes not reported previously. We grouped cyclophilin members with similar molecular weight and subtypes together in the phylogenetic tree which indicated their co-evolution in rice and Arabidopsis. We also characterized a rice cyclophilin gene, OsCyp2-P (Os02g0121300), isolated from a salinity-tolerant landrace, Pokkali. Publicly available massively parallel signature sequencing (MPSS) and microarray data, besides our quantitative real time PCR (qRT-PCR) data suggest that transcript abundance of OsCyp2-P is regulated under different stress conditions in a developmental and organ specific manner. Ectopic expression of OsCyp2-P imparted multiple abiotic stress tolerance to transgenic tobacco plants as evidenced by higher root length, shoot length, chlorophyll content, and K(+)/Na(+) ratio under stress conditions. Transgenic plants also showed reduced lipid peroxidase content, electrolyte leakage, and superoxide content under stress conditions suggesting better ion homeostasis than WT plants. Localization studies confirmed that OsCyp2-P is localized in both cytosol and nucleus, indicating its possible interaction with several other proteins. The overall results suggest the explicit role of OsCyp2-P in bestowing multiple abiotic stress tolerance at the whole plant level. OsCyp2-P operates via reactive oxygen species (ROS) scavenging and ion homeostasis and thus is a promising candidate gene for enhancing multiple abiotic stress tolerance in crop plants.