Roja's score met with high sales and acclaim, in its original and dubbed versions, bringing about an effective transformation in film music at the time, and Rahman followed this with scores for films including, among others, Bombay, Kadhalan, Indira, Minsaara Kanavu, Muthu and Love Birds, which gained him notice. His soundtracks gained him recognition in the Tamil film industry and across the country for his versatality in classical, folk, jazz, reggae, soft rock and other styles in his pieces. Rangeela, directed by Ram Gopal Varma, marked Rahman's debut in Hindi films. Many popular and superhit scores for films including Dil Se and Taal followed. The sales of these albums prompted several film producers to take film music more seriously.
Rahman's work is also unique in the fact that his collaborations with some film directors have always resulted in successful soundtracks. In particular, he has worked with Mani Ratnam on ten films until 2006, all of which have been musical hits. Also notable is his collaboration with the director S. Shankar in the films Gentleman, Kadhalan, Indian, Jeans, Mudhalvan, Nayak, Boys and Sivaji.
His Second movie album Roja was listed in TIME's "Top 10 Movie Soundtracks of All Time" in 2005. Rahman continued to record frequently in his studio, the Panchathan Record Inn. In 2005, a newly developed recording studio, attatched to the Inn called A.M. Studios was opened. It is considered to be the most developed, equipped and high tech studio of Asia. In 2006, Rahman launched his own music label, KM Musiq. It's first release was his soundtrack to the film Sillunu Oru Kaadhal which it released worldwide, in August 2006. His latest work includes Rang De Basanti, Sillunu Oru Kaadhal, Guru, Varalaru - The History of the Godfather, Sivaji: The Boss, Azhagiya Tamil Magan, and Jodhaa Akbar . Rahman has scored the movie Provoked, co-scored Elizabeth: The Golden Age, and is working on Chamki Chameli to be released in 2008 and Hindi version of Tamil blockbuster Ghajini. He is a recipient of the Padma Shri.