Arsenic (As) is one of the toxic heavy metal pollutants found in the environment. An excess of As poses serious threats to plants and diminishes their growth and productivity. NAC transcription factors revealed a pivotal role in enhancing crops tolerance to different environmental stresses. The present study investigated, for the first time, the functional role of SNAC3 in boosting As stress tolerance and grain productivity in rice (Oryza sativa L.). Two SNAC3-overexpressing (SNAC3-OX) and two SNAC3-RNAi transgenic lines were created and validated. The wild-type and transgenic rice plants were exposed to different As stress levels (0, 25, and 50 µM). The results revealed that SNAC3 overexpression significantly improved rice tolerance to As stress and boosted grain yield traits. Under both levels of As stress (25 and 50 µM), SNAC3-OX rice lines exhibited significantly lower levels of oxidative stress biomarkers and OsCRY1b (cryptochrome 1b) expression, but they revealed increased levels of gas exchange characters, chlorophyll, osmolytes (soluble sugars, proteins, proline, phenols, and flavonoids), antioxidant enzymes (SOD, CAT, APX, and POD), and stress-tolerant genes expression (OsSOD-Cu/Zn, OsCATA, OsCATB, OsAPX2, OsLEA3, OsDREB2B, OsDREB2A, OsSNAC2, and OsSNAC1) in comparison to wild-type plants. By contrast, SNAC3 suppression (RNAi) reduced grain yield components and reversed the aforementioned measured physio-biochemical and molecular traits. Taken together, this study is the first to demonstrate that SNAC3 plays a vital role in boosting As stress resistance and grain productivity in rice through modulating antioxidants, photosynthesis, osmolyte accumulation, and stress-related genes expression, and may be a useful candidate for further genetic enhancement of stress resistance in many crops.