The land area of paddy has decreased every year. Karst as one of the most extensive dry land areas in Indonesia is used to raise paddy as well. This study aims to determine the role of land tenancy in rice farming efficiency and the determining factors of the efficiency of rice farming in the karst mountainous Gunungkidul. The research is located in karst mountainous area of Gunung Sewu, Gunungkidul. This study uses the stochastic frontier analysis with cost function approach. The result shows that the estimated parameter of land rent, price of urea fertilizer, labor wage, and production are significantly correlated with the cost production of rice farming. In addition, land tenancy plays an important role in increasing the efficiency of rice farming in the karst mountainous Gunungkidul. Farmers prefer to lease land in the long term between 1-4 years due to the fact that the price offered is cheaper. Other factors that improve the efficiency of rice farming are the number of household members and farm size, while the household head age decreases the efficiency of rice farming.