Henry Rice was born on November 29, 1817, in Waitsfield, Vermont. Because of his father's death when Rice was quite young, he lived with friends. After primary education he studied law for two years. When he was 18, he moved to Detroit, Michigan and participated in the surveying of the canal route around the rapids of Sault Ste. Marie between Lake Superior and Lake Huron. In 1839 he secured a job at Fort Snelling, near what is now Minneapolis, Minnesota. He then became a fur trader with the Ho-Chunk and Chippewa Indians, attaining a position of prominence and influence. Rice was trusted by the Indians, and he was instrumental in negotiating the United States treaty with the Ojibway Indians in 1847.

He lobbied for the bill to establish Minnesota Territory and then served as its delegate to the U.S. Congress from March 4, 1853 to March 3, 1857. His work on the Minnesota Enabling Act during those years facilitated Minnesota's statehood. In 1858 Rice was elected as a Democrat to the United States Senate. He served from Minnesota's admittance on May 11, 1858 to March 3, 1863 and was not a candidate for re-election; he was an unsuccessful candidate for governor in 1865.

Rice also served as a member of the board of regents of the University of Minnesota from 1851 to 1859 and was president of the Minnesota Historical Society. As a United States Commissioner during 1887-1888 he continued to negotiate treaties with the Indians. He died on January 15, 1894, while on a visit to San Antonio, Texas.

In 1916, the state of Minnesota donated a marble statue of Rice to the U.S. Capitol's National Statuary Hall Collection. Rice County, Minnesota is named for him.