Serotonin N-acetyltransferase (SNAT), the penultimate enzyme in melatonin biosynthesis, catalyzes the conversion of serotonin into N-acetylserotonin. Plant SNAT is localized in chloroplasts. To test SNAT localization effects on melatonin synthesis, we generated transgenic rice plants overexpressing a sheep (Ovis aries) SNAT (OaSNAT) in their chloroplasts and compared melatonin biosynthesis with that of transgenic rice plants overexpressing OaSNAT in their cytoplasm. To localize the OaSNAT in chloroplasts, we used a chloroplast targeting sequence (CTS) from tobacco protoporphyrinogen IX oxidase (PPO), which expresses in chloroplasts. The purified recombinant CTS:OaSNAT fusion protein was enzymatically functional and localized in chloroplasts as confirmed by confocal microscopic analysis. The chloroplast-targeted CTS:OaSNAT lines and cytoplasmexpressed OaSNAT lines had similarly high SNAT enzyme activities. However, after cadmium and butafenacil treatments, melatonin production in rice leaves was severalfold lower in the CTS:OaSNAT lines than in the OaSNAT lines. Notably, enhanced SNAT enzyme activity was not directly proportional to the production of N-acetylserotonin, melatonin, or 2-hydroxymelatonin, suggesting that plant SNAT has a role in the homeostatic regulation of melatonin rather than in accelerating melatonin synthesis.