Background and Objectives This study aimed to compare outcomes between neoadjuvant imatinib and upfront surgery in patients with localized rectal gastrointestinal stromal tumors (GIST) patients. Methods Eighty‐five patients with localized rectal GIST were divided into two groups: upfront surgery ± adjuvant imatinib (Group A, n = 33) and the neoadjuvant imatinib + surgery + adjuvant imatinib (Group B, n = 52). Baseline characteristics between groups were controlled for with inverse probability of treatment weighting (IPTW) adjusted analysis. Results The response rate to neoadjuvant imatinib was 65.9%. After the IPTW‐adjusted analysis, patients who underwent neoadjuvant therapy had better distant recurrence‐free survival (DRFS) and disease‐specific survival (DSS) compared with those who underwent upfront surgery (5‐year DRFS 97.8 vs. 71.9%, hazard ratio HR, 0.15; 95% CI, 0.03–0.87; p = 0.03; 5‐year DSS 100 vs. 77.1%; HR, 0.11; 95% CI, 0.01–0.92; p = 0.04). While no significant association was found between overall survival (OS) and treatment groups (p = 0.07), 5‐year OS was higher for the neoadjuvant group than upfront surgery group (97.8% vs. 71.9%; HR, 0.2; 95% CI, 0.03–1.15). Conclusions In patients with localized rectal GIST, neoadjuvant imatinib not only shrunk the tumor size but also decreased the risk of metastasis and tumor‐related deaths when compared to upfront surgery and adjuvant imatinib alone.