Fluctuating climatic conditions and increasing dearth of water resources are severely affecting crop yields. The present study was conducted to explore the genetic diversity for drought tolerance in bread wheat (Triticum aestivum L.) which can be used in future breeding programs. For this purpose, 200 genotypes of bread wheat (Triticum aestivum L.) comprising current cultivars, land races and improved lines were phenotyped over two consecutive seasons (2009-2010 and 2010-2011). Analysis of variance showed significant variation in several morphological and physiological traits including peduncle length (PL), extrusion length (EL), awn length (AL), plant height (PH), leaf rolling (LR), waxiness (WAX), relative water content (RWC), accumulation of proline (Pro), seed size (SZ), grains per spike (gr/sp) and yield/plant (Y) under normal and drought conditions during both years. Using multivariate analysis, two data sets C&S (control and stressed) and C-S/C (relative performance) were prepared to examine plant responses to drought stress. 1st principle component (PC) accounted 24.97% variation for the 1st year and 43.85% variation for the 2nd in C&S dataset. For C-S/C dataset, 18.12% and 15.58% variation was observed in the 1st and 2nd years, respectively. For association mapping, 108 diverse wheat accessions were selected to tag molecular markers for drought tolerance using 25 SSR loci located on chromosome 2A. To eliminate spurious associations, population structure and kinship were taken into account using 30 unlinked markers covering all 21 chromosomes. A total of 11 markers were found associated using MLM (mixed linear model) approach with phenotypic variability ranging from 6.56 to 17.8%. The marker wmc455 was found associated with seed size (r2 7.6%) and plant height (r2 7.3%) under drought conditions. The relative water content was found associated with gwm312 under drought conditions for both years’ data. The marker barc124 showed association with three different traits under different treatments. The study detected novel QTLs for drought adaptive traits and can be used for marker assisted breeding to enhance wheat performance under drought conditions.