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Pakistani rice is popular throughout the globe due to its specific aroma. Rice is categorized as salt-sensitive plant as its growth is significantly reduced under salt toxicity. The effect of exogenous application of indigenous industrial compost (IIC) on the coarse (IRRI-9) and fine (Super basmati-2000) rice varieties under salt stress was investigated in this study. IIC was applied at 0,0.5 and 1.0% of soil weight, along with recommended chemical fertilizers in respective pots. Twenty-day old rice nursery was transplanted in glazed clay pots filled with normal (ECe= 1.70 dS m-1) and saline soil (ECe= 8.0 dS m-1) under flooded condition. Plants were harvested at maturity and different physiochemical parameters were recorded. Salinity stress was found to have significantly (p<0.05) reduced both biological and paddy yield of rice, and the reduction was lower in coarse than fine rice. The compost application significantly improved (p<0.01) dry matter four times as compared with control. In the same way, paddy yield increased three folds both under normal as well as saline growth medium. Na+ concentration in shoots at 1% IIC in growth medium had a significant negative correlation (r=0.90, p<0.01) but potassium concentration proved a significant positive correlation (r=0.92, p<0.01) in both rice varieties. Enhanced salinity tolerance in rice by IIC application was attributed to increased K+ uptake, thereby increasing K+: Na+ ratio and lower Na+ translocation towards shoot (sodium exclusion at the shoot level). It was concluded that indigenous industrial compost application improved the growth of rice plant under salt stress. [ABSTRACT FROM AUTHOR]