The architecture of the panicle, including grain size and panicle morphology, directly determines grain yield. Panicle erectness, which is selected for achieving ideal plant architecture in the northern part of China, has drawn increasing attention of rice breeders. Here, dense and erect panicle 2 (dep2) mutant, which shows a dense and erect panicle phenotype, was identified. DEP2 encodes a plant-specific protein without any known functional domain. Expression profiling of DEP2 revealed that it is highly expressed in young tissues, with most abundance in young panicles. Morphological and expression analysis indicated that mutation in DEP2 mainly affects the rapid elongation of rachis and primary and secondary branches, but does not impair the initiation or formation of panicle primordia. Further analysis suggests that decrease of panicle length in dep2 is caused by a defect in cell proliferation during the exponential elongation of panicle. Despite a more compact plant type in the dep2 mutant, no significant alteration in grain production was found between wild type and dep2 mutant. Therefore, the study of DEP2 not only strengthens our understanding of the molecular genetic basis of panicle architecture but also has important implications for rice breeding.