Interactions between microorganisms and plants can stimulate plant growth and promote nitrogen cycling. Nitrogen fertilizers are routinely used in agriculture to improve crop growth and yield; however, poor use efficiency impairs the optimal utilization of such fertilizers. Differences in the microbial diversity and plant growth of rice soil under different nitrogen application conditions and the expression of nitrogen-use efficiency-related genes have not been previously investigated. Therefore, this study investigates how nitrogen application and nitrogen-use efficiency-related gene NRT1.1B expression affect the soil microbial diversity and growth indices of two rice varieties, Huaidao 5 and Xinhuai 5. In total, 103,463 and 98,427 operational taxonomic units were detected in the soils of the Huaidao 5 and Xinhuai 5 rice varieties, respectively. The Shannon and Simpson indices initially increased and then decreased, whereas the Chao and abundance-based coverage estimator indices decreased after the application of nitrogen fertilizer. Nitrogen fertilization also reduced soil bacterial diversity and richness, as indicated by the reduced abundances of Azotobacter recorded in the soils of both rice varieties. Nitrogen application initially increased and then decreased the grain number per panicle, yield per plant, root, stem, and leaf nitrogen, total nitrogen content, glutamine synthetase, nitrate reductase, urease, and root activities of both varieties. Plant height showed positive linear trends in response to nitrogen application, whereas thousand-grain weights showed a negative trend. Our findings may be used to optimize nitrogen fertilizer use for rice cultivation and develop crop-variety-specific strategies for nitrogen fertilizer application.