The 44-year-old actor is in a relationship with `Pushing Daisies` actress Anna Friel - who has a six-year-old daughter Gracie with ex-partner David Thewlis - and insists he is not too old to become a father.
He said: "Men are never too old to have kids. They might be too old to be fathers, but I don`t think I am yet.
"I`d love to havechildren, it would be nice, yes."
Rhys - who previously dated Sienna Miller - admits being with Anna, 35, has finally taught him how to "compromise" so he is unsure whether he would want to raise a family in his native Wales or elsewhere.
When asked if he would head back to Wales to raise his family, he added to the Daily Mirror newspaper: "I don`t know. Britain is a small place. Life`s about compromises, as I`ve discovered at long last. I`m not some medieval brigand going to put my wife and children in a Welsh cave. With this life, it`s such a random business where you can live, but it does change when you fall in love, and with someone who has a child as well.
"I would never call myself a stepfather but yeah I love kids and want them."