Sustainability of transplanting systems for rice crop establishment in Sri Lanka is threatened due to climatic changes and heavy rains. Tolerance to anaerobic germination (AG) stress is a key trait that will ensure good crop establishment in direct seeded rice (DSR) farming systems. In this study Marker Assisted backcross breeding was carried out to transfer the quantitative trait loci - QTL AG1 (qAG-9-2), in to the local variety Bg 358 for the development of AG stress tolerant elite lines by AG1 donors IR64-AG1 and Ciherang-Sub1AG1. Marker assisted selection (MAS) was carried out through foreground and recombinant selection. Molecular marker optimization for RM24161, RM8300 and RM553 to the QTL AG1 was carried out using BC1F1 populations. DNA was extracted and PCR was performed using simple sequence repeat (SSR) markers and visualized on 2.5% agarose gel. Based on polymorphism exhibited, RM24161 was chosen as the foreground selection marker, RM553 and RM8300 chosen as proximal and distal markers for recombinant selection. It was suggestive through this study to choose flanking markers RM105 & RM219, closer to the qAG-9-2 locus for recombinant selection as the selected recombinant makers were ineffective and exhibited marker segregation distortion. RM24161 was found to be a tightly linked marker to the AG tolerant QTL AG1 (qAG-9-2) and was successfully used for selection of lines by MAS in generation of anaerobic germination tolerant elite lines.