Soil salinization is a major ecological threat to crop growth and production. Biochar addition can alleviate the negative impacts of saline-sodic stress in crops. Here, a two-year field experiment was conducted in a highly saline-sodic paddy field to evaluate the response of soil physico-chemical properties, ionic concentration, and rice yield to biochar applications. The soil was amended with peanut shell biochar as follows: zero biochar (B0), 33.75 t ha−1 (B1), 67.5 t ha−1 (B2), and 101.25 t ha−1 (B3). Biochar significantly reduced soil bulk density (BD), while it markedly increased total porosity (TP) and saturated hydraulic conductivity (Ks). Furthermore, biochar markedly decreased the Na+ concentration, Na+/K+ ratio, Na+/Ca2+ ratio, HCO3-, and CO32- while it increased the concentrations of K+, Ca2+, and Mg2+. Biochar significantly decreased the electrical conductivity of soil saturation extract (ECe). The exchangeable sodium percentage (ESP) of B1, B2, and B3 were 53.6%, 62.3%, and 71.0% lower, respectively, than that of B0, and the corresponding decrease in sodium adsorption ratio (SARe) was 51.2%, 58.1%, and 60.5%. Biochar had no effect on the soil pH but significantly increased the soil cation exchange capacity (CEC). The rice biomass yield, grain yield, and harvest index significantly increased after biochar application.