Planting green manure and straw retention is an effective measure to improve soil fertility. Two-year field experiment were conducted to assess the effects of reduced nitrogen rate under the rice straw mulching combined with planting green manure (Astragalus sinicus L.) at full bloom stage on rice yield, yield components, and soil nutrient availability in Hantai district, Hanzhong city, Shaanxi province from 2018 to 2020. Five treatments were assigned: (1) CK, winter fallow, no straw mulching, no fertilization; (2) NPK, winter fallow, no straw mulching, conventional nitrogen fertilizer rate; (3) GRN1, planting green manure in winter, rice straw mulching with conventional N fertilizer rate; (4) GRN2, planting green manure in winter, rice straw mulching with 80% conventional N rate; (5) GRN3, green manure planting in winter, rice straw mulching with 70% conventional N rate. The results showed that: (I) rice yield (Quanxiangyou 1521) of GRN1 was 10,047 kg hm-2, which was higher 6.7% than that of NPK, and GRN2 and GRN3 had marginal effects in 2019. Moreover, the yield (Huanghuazhan) of GRN2 and GRN3 were significantly higher than that of NPK by 6.6% and 5.8% in 2020, respectively. Compared with CK and NPK, the rice straw mulching combined with planting green manure significantly enhanced the rice yield by 67.9%-83.0% and 2.8%-6.7%, respectively. (II) Planting green manure combined with rice straw mulching increased soil organic carbon content and available P content in 0-20 soil layer. Compared with NPK treatment, soil organic carbon and available P content of GRN2 increased 6.8%-13.2% and 9.9%-12.6%, respectively. Correlation analysis indicated that rice yield was significantly correlated with plant height, fresh weight per plant, fresh root stubble weight, filled grain number per panicle, and 1000-grain weight. Compared with NPK, GRN2 significantly increased effective panicle, effective grain number per panicle by 13.0%-29.3% and 4.5%-14.3%, respectively. Meanwhile, GRN2 significantly increased plant height, fresh weight per plant, and root fresh weight by 10.4%, 23.6%, and 30.0%, respectively. In conclusion, rice stalks mulching combined planting green manure with 20% reduced nitrogen rate can improve rice yield and agronomic performance, enlarge soil carbon sequestration capacity, and increase soil nutrients availability, which is a green rice cultural practice adapted to Hanzhong area.