In order to study the inheritance of field, physiological and metabolite indicators of drought tolerance in wheat, an eight-parental diallel cross, excluding reciprocals, was grown in a randomized complete block design (RCBD) with three replications under two different water regimes (irrigated and rainfed). Significant differences were found for yield potential (Y-p), stress yield (Y-s), stress tolerance index (STI), leaf water potential (LWP), relative water content (RWC), water use efficiency (WUE) and evapotranspiration efficiency (ETE). Y-p, RWC and evapotranspiration efficiency (ETE) showed highly significant differences for both general combining ability (GCA) and specific combining ability (SCA), indicating the involvement of both additive and non-additive gene action in their inheritance. Y-s, STI and WUE revealed highly significant differences for SCA, hence non-additive gene action was predominant for these traits. The best general combiners with positive effects, for improvement of Y-p, Y-s, STI, LWP, RWC, WUE and ETE under drought conditions were parents 5, 1, 6, 2, 7, 1 and 2, respectively. The best specific combination with heterobeltiosis over the best parents for improvement of Y-p, Y-s, STI, LWP, RWC, WUE and ETE were crosses 3 x 6, 2 x 4, 2 x 6, 5 x 8, 2 x 6, 2 x 4 and 1 x 7, respectively indicating that parents of these crosses are genetically diverse. High broad-sense heritability observed for all the traits confirmed that all the traits are more genetic, but because of low narrow-sense heritability the rule of additive part was low.