PaRappa the Rapper sold 761,621 copies in Japan by 1997, making it the 7th best-selling game of the year in that region. As of December 26, 2004, the original version of the game has sold 937,976 copies in Japan, while its PlayStation the Best re-release has sold 306,261 copies meaning it has sold nearly 1.4 Million copies total.

At the first annual Interactive Achievement Awards in 1998, PaRappa the Rapper won the awards for Outstanding Achievement in Interactive Design and Outstanding Achievement in Sound and Music, and was nominated for Interactive Title of the Year.

Parappa was featured recently in the Adult Swim show Robot Chicken. Parappa is featured in the first episode of its fourth season, in which he is in court trying to show that he did not drive while doing drugs and carrying concealed weapons while rapping with Chop Chop Master Onion. After being found not guilty, Parappa is outside of court shortly before getting shot by King Kong Mushi.

PaRappa the Rapper is regarded as the first "modern" popular rhythm game. It was followed by a spin-off titled UmJammer Lammy, which was released on March 18, 1999 in Japan. The game featured a new cast of characters, multiplayer modes and focused on guitar play, but very similar game play. A bonus mode was included in which the entire game could be replayed with Parappa as the protagonist, complete with his own versions of the game's stages. An arcade version of the game produced by Namco was also released.

A direct sequel, PaRappa the Rapper 2, was released on August 30, 2001 for the PlayStation 2. The franchise has spawned a large range of merchandising and a children's anime TV series, PaRappa Rappa, which began airing in April 2001 on Fuji TV in Japan.

In 2007, it was rumored that work had begun on a PlayStation 3 sequel entitled PaRappa the Rapper 3.

These rumors have since died down and it has been confirmed on Rodney Greenblat's own website that a 3rd Parappa game will not be released any time soon.