To analyze the hyperspectral reflectance characteristics of rice canopies under changes in diffuse radiation fraction, experiments using different cover materials were performed in Nanjing, China, during 2016 and 2017. Each year, two treatments with different reduction ratios of diffuse radiation fraction but with similar shading rates were set in the field experiment: In T1, total solar radiation shading rate was 14.10%, and diffuse radiation fraction was 31.09%; in T2, total solar radiation shading rate was 14.42%, and diffuse radiation fraction was 39.98%, respectively. A non-shading treatment was included as a control (CK). Canopy hyperspectral reflectance, soil and plant analyzer development (SPAD), and leaf area index (LAI) were measured under shading treatments on different days after heading. The red-edge parameters (position, λ0; maximum amplitude, Dλ; area, α0; width, σ) were calculated, as well as the area, depth, and width of three absorption bands. The location of the first absorption band appeared in the range of 553–788 nm, and the second and third absorption bands appeared in the range of 874–1257 nm. The results show that the shading treatment had a significant effect on the rice canopy’s hyperspectral reflectance. Compared with CK, the canopy reflectance of T1 (the diffuse radiation fraction was 31.09%) and T2 (the diffuse radiation fraction was 39.98%) decreased in the visible light range (350–760 nm) and increased in the near-infrared range (800–1350 nm), while the red-edge parameters (λ0, Dλ, α0), SPAD, and LAI increased. On the other hand, under shading treatment, the increase in diffuse radiation fraction also had a significant impact on the hyperspectral spectra of the rice canopy, especially at 14 days after heading. Compared with T1, the green peak (550 nm) of T2 reduced by 16.12%, and the average reflectance at 800–900 nm increased by 10%. Based on correlation analysis, it was found that these hyperspectral reflectance characteristics were mainly due to the increase in SPAD (2.31%) and LAI (7.62%), which also led to the increase in Dλ (8.70%) and α0 (13.89%). Then, the second and third absorption features of T2 were significantly different from that of T1, which suggests that the change in diffuse radiation fraction could affect the process of water vapor absorption by rice.