The government announced the number on Wednesday and called for further efforts to end the "scourge."
In 2018, 769 rhinos were killed by poachers, down from 1,028 killed in 2017. It was the first time in five years that the number dipped below 1,000 as conservationists battle against insatiable demand for rhino horn in Asia.
"Although we are encouraged by the national poaching figures for 2018, it is critical that we continue to implement collaborative initiatives to address the scourge of rhino poaching," environment minister Nomvula Mokonyane said in a statement.
A total of 421 rhinos were poached in the famous Kruger National Park in 2018 - 16.5 percent less than the 504 poached in 2017.
The ministry said the "significant progress" was due to dedicated staff on the ground and improved domestic and international cooperation.
Last year, 365 alleged rhino poachers and 36 alleged rhino horn traffickers were arrested in South Africa, most of them in or near Kruger, a global hotspot for game watchers and safari holidaymakers.
The number of rhinos killed climbed steeply in the past decade from just 13 in 2007, reaching a peak of 1,215 in 2014, according to the Traffic wildlife trade monitoring group.
South Africa is home to 80 percent of the world's remaining rhinos.
Most of the demand emanates from China and Vietnam, where the horn is coveted as a traditional medicine, an aphrodisiac or as a status symbol.
According to Traffic, criminal networks of Chinese origin work in South Africa processing rhino horn into beads, bracelets, bangles and powder to evade detection and supply wealthy, middle-class urban consumers in Asia, mainly in China and Vietnam.
Rhino horn is composed mainly of keratin, the same substance as in human nails.
It is often sold in powdered form as a supposed cure for cancer and other diseases.