The importance of rice in food security and livelihoods of Nepalese people is well recognized but the seed supply system of this crop in the rural areas is poorly developed. To increase farmers’ access to a wide range of rice varietal choices in a cost effective way, some farmers, organized in groups or cooperatives, have started producing and marketing rice seed through development projects in recent years. But very limited information has been published about the performance of the farmers in rice seed marketing. In this study, we analyze the impact of households’ socio-economic variables on market participation and volume of rice seed sold, using a Heckman selection model. Data for the study were collected from three Tarai districts (Siraha, Kailali and Chitwan) in Nepal with a sample size of 180, that is, 60 households from each district. Result shows that 65% of households sell 64% of rice seed produced. Households with agricultural training, share contribution to their organization and higher livestock numbers are more likely to participate in the market. Similarly, households with older household heads, higher operational land, and access to an irrigation facility sell a higher amount of rice seed in the market. Seed price has a positive influence both on market participation and seed volume sold.