High CO2 concentrations stimulate net photosynthesis by increasing CO2 substrate availability for Rubisco, simultaneously suppressing photorespiration. Previously, we reported that silencing the chloroplast vesiculation (cv) gene in rice increased source fitness, through the maintenance of chloroplast stability and the expression of photorespiration‐associated genes. Because high atmospheric CO2 conditions diminished photorespiration, we tested whether CV silencing might be a viable strategy to improve the effects of high CO2 on grain yield and N assimilation in rice. Under elevated CO2, OsCV expression was induced, and OsCV was targeted to peroxisomes where it facilitated the removal of OsPEX11‐1 from the peroxisome and delivered it to the vacuole for degradation. This process correlated well with the reduction in the number of peroxisomes, the decreased catalase activity and the increased H2O2 content in wild‐type plants under elevated CO2. At elevated CO2, CV‐silenced rice plants maintained peroxisome proliferation and photorespiration and displayed higher N assimilation than wild‐type plants. This was supported by higher activity of enzymes involved in NO3− and NH4+ assimilation and higher total and seed protein contents. Co‐immunoprecipitation of OsCV‐interacting proteins suggested that, similar to its role in chloroplast protein turnover, OsCV acted as a scaffold, binding peroxisomal proteins.