Poor N fertilizer use efficiency by flooded rice is caused by gaseous losses of N. Improved fertilizer management and use of nitrification inhibitors may reduce N losses. A microplot study using N-15-labelled urea was conducted to investigate the effects of fertilizer application method (urea broadcast, incorporated, deep-placed) and nitrification inhibitor [encapsulated calcium carbide (ECC)] treatments on emission of N-2+N(2)0 and total loss of applied N on a grey clay near Griffith, NSW, Australia. Both incorporation and deep placement of urea decreased N-2+N2O emission compared to urea broadcast into the floodwater. Addition of ECC significantly (P < 0.05) reduced emission of N-2+N(2)0 from incorporated or deep-placed urea and resulted in increased exchangeable ammonium concentrations in the soil in both treatments. Fifty percent of the applied N was lost when urea was broadcast into the floodwater. Total N loss from the applied N was significantly (P < 0.05) reduced when urea was either incorporated or deep placed. In the presence of ECC the losses were reduced further and the lowest loss (34.2% of the applied N) was noted when urea was deep-placed with ECC.