ER retention receptor is a seven trans-membrane protein that plays pivotal roles in function and integrity of endoplasmic reticulum (ER). Insertional mutagenesis of Magnaporthe oryzae identified MoERR1 as a pathogenicity gene encoding putative ER retention receptor orthologous to ERD2 in Saccharomyces cerevisiae. Search through the genome identified that M. oryzae possesses another ortholog of ERD2, which is designated as MoERR2. When MoERR1 and MoERR2 were tagged with GFP, both were localized to ER. Targeted disruption of MoERR1 showed pleiotropic effects on phenotypes, while deletion of MoERR2 had no effect on phenotypes we examined. The disruption mutant of MoERR1 showed growth retardation and produced significantly reduced number of conidia with aberrant morphology. Appressoria from the mutant were unable to penetrate into plant tissues presumably due to defect in cell wall integrity, thereby rendering the mutant non-pathogenic. The MoERR1 mutant also appeared to display abnormal ER structure and mis-regulation of genes involved in chaperone function and unfolded protein response under ER stress condition. Taken together, these results suggest that MoERR1 is a ER retention receptor required for function and integrity of ER, and that MoERR1-mediated ER functionalities are essential for fungal development and pathogenesis.