Fifty maize inbred lines collected from different sources were screened at seedling stage for drought tolerance in glasshouse.One drought tolerant and one sensitive line were selected and used to develop six generations (P1, P2, F1, F2, BC1 and BC2). The generations were evaluated in glasshouse and field simultaneously under normal and drought conditions. Data on various seedling and morpho-physiological parameters were recorded and analyzed statistically. There was a decreasing trend for all the traits except anthesis-silking interval and leaf temperature under drought condition. Additive and dominance genetic effects were found for all seedling traits under normal condition except fresh and dry root weight which had additive genetic effects. Similarly additive and dominance gene action was involved for all seedling traitsunder drought condition except fresh root length and fresh and dry root weight, which were under additive genetic control. Additive genetic effects were present for the inheritance of days to silking, anthtesis-silking interval, ear leaf area, plant height, days to maturity, 100 grain weight and relative water content under normal condition, whereas days to tasseling, ear length, kernels per ear, grain yield per plant, cell membrane thermo-stability and leaf temperature showed the presence of both additive and dominance genetic effects. However under drought condition, days to tasseling, anthtesis-silking interval, ear leaf area, plant height, ear length, kernels per ear and cell membrane thermo-stability had both additive and dominance genetic effects, whereas additive genetic effects were observed for days to silking, days to maturity, 100 grain weight, grain yield per plant, relative water content and leaf temperature. Narrow sense heritability was high for most of the seedling and morphophysiological traits under both conditions, whereas genetic advance was maximum for grain yield per plant, ear leaf area and kernels per ear under water stress. Inbreeding depression was also maximum for grain yield per plant, ear leaf area and kernels per ear under water stress. Root/shoot ratio was positively and significantly correlated both on phenotypic and genotypic basis with fresh and dry root weight under both conditions. Grain yield had positive and significant association with days to maturity, ear length, number of kernels per ear, cell membrane thermo-stability and relative water content on phenotypic and genotypic basis under both normal and drought conditions, whereas negative and significant phenotypic correlations of grain yield were found with leaf temperature under both conditions. Grain yield of maize may be enhanced by improving ear length, kernels per ear, cell membrane thermo-stability and relative water content.