To study general and specific combining ability of some rice varieties for grain physical properties and milling quality, a diallel design with five parents (Hashemi, Vandana, Kadous, Shahpasand and IR36) was used. Parents and their F₁ progenies (25 genotypes) were grown in a randomized complete blocks design with three replications in the Research Field of Rice Research Institute of Iran (RRII), Rasht, Iran, during 2012, and nine different characteristics were recorded. Analysis of variance showed that there were significant differences among genotypes and also general and specific combining ability for all of studied traits, showing the role of additive and non-additive gene effects. Furthermore, the effects of reverse crosses for all studied traits except, degree of grains whiteness, were significant which indicated the role of maternal effects. The significance of MS_GCA/MS_SCA ratio, Baker ratio (genetic ratio) near to one and high narrow-sense heritability for physical characteristics showed that the additive gene effects controlling these traits were important than the non-additive gene effects, while non-significance of MS_GCA/MS_SCA ratio, Baker ratio (genetic ratio) less than one and low heritability for milling characteristics showed the role of non-additive gene effects. Results from graphical analysis based on Hayman method showed that all physical characteristics related to grain quality were controlled by partial dominance effect, while all milling properties were controlled by complete dominance to over dominance gene effect. The results of this research showed that the selection of elite progenies is suitable method to improve the physical characteristics in studied population, while hybrid production method will be suitable to improve milling quality in this population.