Our knowledge about the efficiency of different methods of parental selection, inheritance of traits related to drought tolerance (physiologic and root traits) and molecular markers associated with traits is very rare in orchardgrass. This research was conducted in three separate studies. In the first study, for the development of synthetic varieties to maximize heterosis especially in respect to drought tolerance, four polycrossed groups each composed of six parental plants with contrasting levels of diversity (high and low) based on molecular markers (ISSR and SRAP( and phenotypic traits were constructed. First generation progenies of the four polycroed groups were evaluated in terms of morphologic, agronomic and physiological traits during two years in the field and for germination and seedling growth properties in the laboratory under normal and drought stress conditions. In both water conditions, considerable genetic variation was observed among progenies indicating that the progeny performance depends on the type and level of diversity among the parental genotypes. Positive and significant associations were observed between parental molecular diversity and progeny performances of all traits at both moisture conditions, suggesting the existence of heterotic effects for different traits. High molecular genetic diversity led to a significant yield advantage, with averages of 34% for normal and 48% for drought stress conditions, compared with the polycross parents yield. Also crosses between genetically distant parents produced late heading progenies with high germination performance and considerable drought tolerance and yield stability. Relationships between parental phenotypic diversity and progenies performance was strongly affected by the target trait and moisture conditions. Superiority of progenies from parents with high molecular diversity under both moisture conditions emphasizes the benefit of marker-assisted polycross breeding for combining heterosis in different traits and development of superior synthetic varieties. In the second study, association analysis of ISSR and SRAP markers with studied traits was done under normal and drought stress conditions. The results of population structure analysis identified five main subpopulations. Under normal and drought stress conditions, respectively, 497 and 528 markers were significantly associated with the studied traits. Most of these markers were associated with more than one trait, which would be considered to be pleiotropic or co-localized marker-trait associations. Under normal conditions markers M1/E2-12, M1/E3-16, M3/E2-10 and P9-3, and under drought stress conditions, markers M4/E4-5, M3/E4-20, M3/E4-6, M2/E3-24, M1/E3-16 and P841-1 exhibited simultaneously strong association with SY and DMY. In this study, 120 markers showed stable associations across two moisture conditions. Marker–trait association revealed that markers M1/E1-5, M2/E6-5, M3/E4-6, P14-7 and P845-7 were consistently linked with drought tolerance index. Informative markers which had association with forage yield, seed yield, root traits and drought tolerance index, are introduced for further analysis of their chromosomal locations and the corresponding sequences. In the third study, for genetic analysis of root traits, 30 half-sib families derived from polycross of 30 orchardgrass genotypes were planted in PVC tubes (60×16 cm) to measure morphological and root traits under both normal and drought stress conditions. Root characters were measured at 0-30 and 30-60 cm soil depths. Under drought stress conditions, the root/shoot ratio and percentage of root dry matter increased compared with control in both soil depths. Values for root length, root area and root volume were decreased at 0-30 cm soil depth, whilst at 30–60 cm depth, values for these traits were increased. The high values of additive gene effects and heritability for some root traits indicated that selection would be effective for improving these traits. Indirect selection to improve dry matter yield was most efficient when selecting for crown diameter under normal conditions and for root length and root dry weight under drought stress conditions. Significant associations of drought tolerance and yield stability indices with root length, root area, root volume and root dry weight confirmed the importance of root traits in conferring drought tolerance and yield stability of orchardgrass. Key Words Orchardgrass, Genetic distance, Heterosis, Drought stress, Association analysis, Root system, Indirect selection.