In Thailand, flooding due to seasonal monsoon conditions frequently destroys a substantial amount of rice production, the most important agricultural activity of the country. Taking the 2001 monsoon flooding that hit the Lower Chi River Basin as an example, we developed a new method for accurately assessing damage to flood‐affected paddies. A RADARSAT‐1 image acquired during peak flooding was combined with a 30‐m digital elevation model (DEM) to develop a ‘flood‐level‐determination’ algorithm for estimating floodwater depth. Based on the elongation capability of the rice varieties, a water depth of 80 cm was used to separate ‘non‐damaged’ from ‘damaged’ paddy areas, indicating that about 60% of the paddy fields in the flooded areas were non‐damaged paddies. To minimize the loss of rice and maximize farmers' incomes, a map of rice varieties appropriate for the damaged paddy areas was produced, combining the flood‐affected paddy map with the flood frequency map. Our results demonstrate the potential of using single‐date RADARSAT‐1 data and a DEM to provide accurate and economic means of assessing flood damage to rice fields that can be used to improve rice production.