Efficient oxygen transport via enhanced root aerenchyma and a barrier to impede radial oxygen loss (ROL) from roots to rhizosphere is essential for plants inhabiting wetland conditions. When grown in stagnant conditions, a rice mutant drp7 (dripping wet leaf 7), lacking a functional Leaf Gas Film-1 (LGF1) gene, forms poor aerenchyma spaces and a weak barrier to ROL in roots; whereas its wild-type (cv. Kinmaze) develop high root aerenchyma spaces and a tight barrier to ROL in roots. LGF1-overexpression lines in the drp7 mutant background were developed. The formation of a tight barrier to ROL was recovered in the overexpression lines when grown in stagnant conditions. In contrast, the aerenchyma formation was only partly recovered. Transgenic rice introducing the LGF1 promoter::GUS gene was used to visualize tissue-specificity of gene expression in roots. The GUS expression profiles indicated higher activity of the LGF1 gene in the hypodermis/exodermis cell layers near the root tips in stagnant but not in control conditions. Moreover, ROL from roots and extensive chemical characterization of roots were conducted. The formation of specific wax compounds in enzymatically separated root hypodermal/exodermal cell layers was higher in the wild-type genotype in comparison to the mutant line. The LGF1-overexpression lines showed significant increase in the amount of root waxes, in comparison to the mutant line. The identification of the LGF1 gene as a gene that is responsible for the development of tight barriers to ROL represents a major advance in the development of waterlogging tolerant plants.