KNB422 is a fungal isolate effective at controlling rice seedling diseases such as Bakanae disease, when applied to seeds. When a granulated soil for rice nurseries containing KNB422 (KNB422-soil) was used, several seed-borne diseases caused by fungal as well as bacterial pathogens, such as Gibberella fujikuroi and Burkholderia plantarii, were controlled efficiently during seedling production. Using KNB422-soil also controlled soil-borne diseases caused by Rhizopus oryzae, Pythium graminicola, Trichoderma viride, and Fusarium sp. as effectively as chemical pesticides. A combination of KNB422-soil and hot-water submersion of rice seeds completely controlled Bakanae disease without any chemicals. Since the use of KNB422-soil for rice seedling production was sufficiently controlled seed-borne and soil-borne diseases and hot-water submersion enhanced its activity, this new material would reduce chemical usage and labor.