Carbon isotope discrimination (Delta C-13) is considered a useful indicator for indirect selection of grain yield (GY) in cereals. Therefore, it is important to evaluate the genetic variation in Delta C-13 and its relationship with GY. A doubled haploid (DH) population derived from a cross of two common wheat varieties, Hanxuan 10 (H10) and Lumai 14 (L14), was phenotyped for Delta C-13 in the flag leaf, GY and yield associated traits in two trials contrasted by water availability, specifically, rain-fed and irrigated. Quantitative trait loci (QTLs) were identified by single locus and two locus QTL analyses. QTLs for Delta C-13 were located on chromosomes 1A, 2B, 3B, 5A, 7A and 7B, and QTLs for other traits on all chromosomes except 1A, 4D, 5A, 5B and 6D. The population selected for high Delta C-13 had an increased frequency of QTL for high Delta C-13, GY and number of spikes per plant (NSP) when grown under rain-fed conditions and only for high Delta C-13 and NSP when grown under irrigated conditions, which was consistent with agronomic performance of the corresponding trait values in the high Delta C-13 progeny; that is, significantly greater than that in the low Delta C-13. Therefore, selection for Delta C-13 was beneficial in increasing grain yield in rain-fed environments.