Rice yields can only be achieved by selecting a high-quality population. Nitrogen rates and transplanting density play a significant role in determining population quality and yield. Field experiments were conducted in Heshan District, Hunan Province, China, to explore suitable nitrogen rates and appropriate transplanting densities for rice production in 2021 and 2022. In this study, three levels of nitrogen, e.g., N1, N2, and N3 (0, 150, and 210) kg ha−1, and three transplanting densities, e.g., B1, B2, and B3 (1, 2, and 3) seedlings per hill were used to study their individual or combined effects on rice (Taiyou 390) population quality, yield, and yield components, nitrogen-related enzyme activities, and nitrogen absorption and utilization efficiency. The results showed that N2B3 had the highest yield, with an average yield of 9.30 t ha−1 in two years, which was 3.7~49.6% higher than other treatments. This increase was attributed to higher dry matter accumulation (1538.22 g m−2) and effective panicle number (435.2 × 104 ha−1), influenced by increased nitrate reductase activity at the booting stage and glutamine synthase at the heading stage, along with maintenance of higher SPAD value and leaf area index. Nitrogen rates and transplanting densities significantly affected nitrogen use efficiency, with the contribution rate of nitrogen fertilizer to yield decreasing as nitrogen rates increased. However, N2B3 improved nitrogen use efficiency and stabilized rice yield by reducing nitrogen fertilizer application. This study suggested that N2B3 treatment could enhance rice yield by improving plant nitrogen use efficiency under low nitrogen supplementation.