Abstract: Background and Objective: Aromatic rice MRQ74, known as Maswangi is an important rice variety in Malaysia. However, drought tolerance is essential for the growth of MRQ74. This study was conducted by exposing naked seeds to acute gamma radiation to induce callus embryogenesis. Methodology: A dose response experiment was performed at the Nuclear Malaysia Agency to expose the naked MRQ74 seeds to 350 Gy; these seeds were cultured to produce callus on Murashige and Skoog (MS) media supplemented with 2,4-D, (1.0, 2.0 or 3.0 mg L–1) and Kin (0.1 and 0.2 mg L–1) for 4 weeks. Under the optimized conditions in media and regeneration, the callus was introduced to drought stress with 1.5, 3, 4.5, 6 and 7% PEG (MW 6000). Results: The most efficient response to callusing was found at 3 mg L–1 2,4-D and 0.1 mg L–1 kinetin. Shoot and root formation were respectively optimized in MS+3.0 mg L–1 (BAP)+0.1 mg L–1 (NAA) and MS+1.0 mg L–1 (IBA)+0.1 mg L–1 2,4-D. The highest fresh weight of callus and increase in proline enzyme concentrations were obtained through acute gamma radiation at 7% PEG strength. Conclusion: This study successfully establishes a novel potential mutant line as an improved drought-tolerant MRQ74 variant. Further research should be conducted to investigate the nutrient properties and yield of this novel mutant.