Rice (Oryza sativa L.) is a staple crop crucial for food security, and its cultivation in Tamil Nadu, India, is faced with several challenges such as changing climatic conditions, water scarcity, and soil degradation. The genetic diversity of rice germplasm plays a key role in addressing these challenges by providing a pool of genetic resources for breeding programs focused on improving traits such as yield, disease resistance, and abiotic stress tolerance. This review explores the genetic diversity within rice germplasm in Tamil Nadu, highlighting its evaluation for breeding purposes. Various traits such as yield potential, disease resistance, grain quality, and stress tolerance are essential for developing improved rice varieties. Molecular techniques, including marker-assisted selection (MAS), along with phenotypic evaluation, are crucial for selecting varieties with desirable traits. The review emphasizes the importance of genetic diversity in breeding for resilient rice cultivars capable of meeting the demands of a changing environment and growing population. By leveraging modern breeding technologies, rice cultivation in Tamil Nadu can be significantly enhanced to ensure food security and sustainable agriculture in the region.