The genetic divergence in 40 genotypes of rainfed rice (Oryza sativa L) was assessed utilizing Mahalanobis's D² statistic. These varieties fell in seven clusters. Total spikelets per panicle, photosynthetic rate and 1000-grain weight contributed maximum to total genetic divergence. The average interciuster D value was maximum (51.88) between the clusters V and Vll indicating high genetic divergence between the cultivars of these two clusters. Based on genetic distance, mean performance and clustering pattern, hybridization of the cultivar Pankaj with CTH-3 or Kanthimori or Chachakki biliakki and CTH-3 with Kanthimori or Jolagabatta or Dodabatta was suggested to be appropriate in breeding.