Indonesia’s strategies are focus on improving food production using environmentally-friendly measures in its agricultural development. This research was designed in accordance with the national strategies on increasing the productivity of rice using efficient water while reducing methane emissions from rice fields. A low rice yield is obtained when the conventional anaerobic methods (flooded soil) are used. Additional to the water, sludge from palm oil factories was also applied. This research aimed to establish a proper concentration of sludge to increase the productivity of rice sown in aerobic condition with the water level at 5 cm below soil surface. The study was conducted by making experiments with 5 levels. Waste sludge from palm oil factories was applied on the soils tested with concentrations of 0 t ha-1, 10 t ha-1, 15 t ha-1, 20 t ha-1 and 25 t ha-1. Height of the plant, total number of tillers, number of productive tillers, number of filled grains, percentage of filled grains, weight of 1000 grains and weight of filled grain per plot were studied. Application of 25 t ha-1 organic sludge showed a high level of productivity increasing the total number of tillers, the number of productive tillers and weight of filled grain per plot.