The heat shock response (HSR) induces the production of heat shock proteins (HSPs) through the activation of heat shock factors (HSF). HSF binding protein (HSBP) is reported to modulate the function of HSF by binding to their trimer and hence to regulate HSR. This report describes the role of OsHSBP1 and OsHSBP2 in the regulation of the HSR and seed development of rice. Both genes expressed ubiquitously in all tissues under normal growth conditions while their expression levels were significantly increased during recovery after heat shock treatment. Subcellular localization revealed the cytosol-nuclear localization of both OsHSBP1 and OsHSBP2 in onion epidermal cells. The yeast two-hybrid assay depicted the self-binding ability of both genes. Both genes were also important for seed development, as their knock-down lines were associated with significant seed abortion. The thermotolerance assay revealed that OsHSBP1 and OsHSBP2 are negative regulators of HSR and involved in acquired thermotolerance but not in basal thermotolerance since their over-expression transgenic lines pre-heated at sublethal temperature, showed significantly decreased seedling survival after heat shock treatment. Furthermore, antioxidant activity and gene expression of catalase and peroxidase was significantly increased in knock-down transgenic seedlings of OsHSBP1 and OsHSBP2 after heat stress compared with the wild type. The expression of heat specific HSPs was also increased significantly in knockdown line of both genes but in a specific manner, suggesting the involvement of HSBP genes in different pathways. Overall, the present study reveals the role of OsHSBP1 and OsHSBP2 in the regulation of the HSR and seed development of rice.