A long-term field experiment was conducted to study the effect of reducing controlled-release urea (CRU) on yield, economic benefit and photosynthetic characteristics, and the relationship between yield components and yield of double-cropping rice in order to find out the optimal application rate of CRU for saving cost and improving efficiency. The results showed that compared with conventional fertilization treatment, for early rice, CRU treatments increased early and late grain yield (2015—2016) by 2.6%–8.1% and 6.7%–22.3%, and economic benefit, total spikelet number and total grain number increased by 3.00%, 0.02% and 6.34% of reducing N 10% for early rice, for late rice, reducing N 20% treatment increased by 12.18%, 5.09% and 6.53%, respectively. The above increasing effects were better for late rice than early rice. With reducing N application rate, the net photosynthetic rate in CRU treatments was first increased and then decreased. Correlation analysis showed that the grain yields were significantly positively correlated with the total number of spikelet and total number of grains of early- and late- rice. By considering the rice yield and economic benefit, it is concluded that on the basis of the conventional N application level, proper reducing N application rate in CRU in double-cropping rice region is conducive to the formation of the effective spikes, improve the net photosynthetic rate of rice function leaves, effectively expand the grain storage capacity, and thus promote the saving cost and improving yield and efficiency in double–cropping rice system. Reducing 10% N is optimum for early rice while reducing 20% N optimal for late rice.