Sheath blight (ShB) is the most serious disease of rice (Oryza sativa L.), caused by the soil-borne fungus Rhizoctonia solani Kühn (R. solani). It poses a significant threat to global rice productivity, resulting in approximately 50% annual yield loss. Managing ShB is particularly challenging due to the broad host range of the pathogen, its necrotrophic nature, the emergence of new races, and the limited availability of highly resistant germplasm. In this study, we conducted QTL mapping using an F2 population derived from a cross between a partially resistant accession (IRGC81941A) of Oryza nivara and the susceptible rice cultivar Punjab rice 121 (PR121). Our analysis identified 29 QTLs for ShB resistance, collectively explaining a phenotypic variance ranging from 4.70 to 48.05%. Notably, a cluster of four QTLs (qRLH1.1, qRLH1.2, qRLH1.5, and qRLH1.8) on chromosome 1 consistently exhibit a resistant response against R. solani. These QTLs span from 0.096 to 420.1 Kb on the rice reference genome and contain several important genes, including Ser/Thr protein kinase, auxin-responsive protein, protease inhibitor/seed storage/LTP family protein, MLO domain-containing protein, disease-responsive protein, thaumatin-like protein, Avr9/Cf9-eliciting protein, and various transcription factors. Additionally, simple sequence repeats (SSR) markers RM212 and RM246 linked to these QTLs effectively distinguish resistant and susceptible rice cultivars, showing great promise for marker-assisted selection programs. Furthermore, our study identified pre-breeding lines in the advanced backcrossed population that exhibited superior agronomic traits and sheath blight resistance compared to the recurrent parent. These promising lines hold significant potential for enhancing the sheath blight resistance in elite cultivars through targeted improvement efforts.