A new high-yielding upland rice variety known as New Rice for Africa (NERICA) has been recognised widely as a promising technology for addressing the food shortage and poverty problems in sub-Saharan Africa. This, however, is no guarantee for NERICA’s widespread adoption. This study attempts to assess the major determinants of the adoption of NERICA in the early stages of its diffusion in Uganda. Contrary to common belief, we found that asset endowment did not affect farmers’ adoption of NERICA. This is likely because of government intervention under a programme that promoted domestic rice production through the free distribution of seed or as in-kind credit, coupled with an absence of farmers’ investment in complementary inputs such as fertilizer and irrigation. However, as expected, membership in farmers’ groups increased the probability of adopting NERICA. The government programme promoting NERICA significantly increased its adoption rate, although the lack of extension services, training in post-harvest treatment and better management practices for rice cultivation limited the yield of and income from NERICA.