Bioactive gibberellins (GAs) are key endogenous regulators of plant growth. Previous work identified ELONGATED UPPERMOST INTERNODE1 (EUI1) as a GA deactivating enzyme which plays an important role in panicle exsertion in rice (Oryza sativa). However, the mechanism that controls EUI1 activity during development is still largely unexplored. In this study, we identified a dominant panicle enclosure mutant regulator of eui1 (ree1-D), which is caused by the activation of a homeodomain-leucine zipper transcription factor HOX12. Diminished HOX12 expression by RNA interference enhances the panicle exsertion, mimicking the eui1 phenotype. Quantification of GA levels in the uppermost internodes revealed that the HOX12 knockdown plants contain higher levels of the major biologically active GAs (such as GA1 and GA4) than these in the wild type. The expression of EUI1 is elevated in the ree1-D mutant but lowered in HOX12 knockdown plants. Interestingly, both HOX12 and EUI1 genes are predominantly expressed in panicles, where GA4 is highly accumulated. Yeast one-hybrid, electrophoretic mobility shift assay, and chromatin immunoprecipitation analyses showed that HOX12 physically interacts with EUI1 promoter both in vitro and in vivo. Furthermore, overexpression of HOX12 in eui1 mutant background remains the elongated uppermost internode phenotype. These results reveal a novel regulatory module that HOX12 acts directly through EUI1 to regulate panicle exsertion in rice.