Urea-intercalated kaolinite containing 20 wt% urea was granulated and coated with water-based epoxy resin to prepare nitrogen-based controlled release fertiliser (NCRF). The nitrogen release property was studied using UV-Vis spectroscopy through the diacetylmonoxim colorimetric method for different samples of granules of urea-intercalated kaolinite and non-intercalated urea–kaolinite mixture. Also the effect of granules size and different coating thickness on nitrogen release from coated NCRFs was investigated. The results of release experiments revealed that intercalation of urea into kaolinite caused a three times decrease in the nitrogen release compared to non-intercalated sample. Also, by increasing the size of granules and thickness of coating, the nitrogen release ratio from NCRFs decreased. Finally, a glasshouse trial was conducted to evaluate the effect of coated urea-kaolinite compared with a non-coated one and conventional urea fertiliser granules on rice productivity (Variety MR 219). The yield together with some yield component data (filled spikelet, spikelet per panicle, productive tiller) revealed a highly significant and positive response to coated CRF N fertiliser treatment (one time application). Also, the pooled data of the yield and yield component emphasised that the rice crop responded significantly to treatments involving CRF nitrogen fertilisers as compared to others. The maximum grain yield of 28.73 g/pot belongs to coated CRF, medium grain yield of around 21.74 g/pot from the non-CRF N fertilisers plots and the lowest yield was obtained where conventional urea was applied. The other morphological and physiological characters show a similar trend to the yield.