MicroRNAs (miRNAs) play an important role in plant development, and are involved in biotic and abiotic stress resistance. Previously, we identified the miR171a being as a drought-responsive miRNA in rice by small RNA sequencing. However, the mechanisms underlying the involvement of miR171a in drought stress response remains unknown. Therefore, in this study, we aimed to elucidate the molecular mechanisms miR171a in drought stress response. miR171a-overexpression (OX-miR171a) and miR171a-blocking (STTM171, a short tandem target mimic) lines were generated and characterized. The results indicated that overexpression of miR171a affected rice yield related traits, including primary panicles, 1000–grain weight, and root development trait by regulating primordial differentiation and cell size in the meristematic zone. Furthermore, miR171a overexpression significantly enhanced drought tolerance. In addition miR171a gene knockout significantly reduced this trait in both rice and Arabidopsis. We confirmed that miR171a overexpression confers plant abscisic acid-dependent drought stress resistance. In conclusion, we found that miR171a plays a key role in modulating plant growth development and drought response. Therefore, miR171a serves as a potential target for engineering improved plant drought resistance and yield.