Nitrogen (N) is a macronutrient that boosts carbon (C) metabolism and plant growth leading to biomass accumulation. The molecular connection between nitrogen utilization efficiency (NUE) and biomass production remains unclear. Here, via quantitative trait loci analysis and map-based cloning, we reveal that natural variation at the MYB61 locus leads to differences in N use and cellulose biogenesis between indica and japonica subspecies of rice. MYB61, a transcriptional factor that regulates cellulose synthesis, is directly regulated by a known NUE regulator GROWTH-REGULATING FACTOR4 (GRF4), which coordinates cellulosic biomass production and N utilization. The variation at MYB61 has been selected during indica and japonica domestication. The indica allele of MYB61 displays robust transcription resulting in higher NUE and increased grain yield at reduced N supply than that of japonica. Our study hence unravels how C metabolism is linked to N uptake and may provide an opportunity to reduce N use for sustainable agriculture.