Drought stress is the most limiting factor for economic yield of crops in the arid and semi-arid regions. Due to the increasing limitation of water resources and the importance of safflower as a multi-purpose crop (oilseed and pharmaceutical), improving drought tolerance is an important objectives in its breeding programs. This research was performed in three studies. In the first study, the genetic parameters of some morpho-physiological and agronomic traits were evaluated under non-stress and water stress conditions, using 21 F 2 and F 3 populations derived from the genetic design of 7×7 half-diallel along with their parents. In 2016, the F 2 populations along with parents and in 2017, the F 3 populations along with parents were planted in the field in two separate experiments under non-stress and water stress conditions in a randomized complete block design with two replications. The data analysis based on the Griffing’s method showed that both the additive and the non-additive gene actions were involved in the genetic control of the traits under both moisture conditions in both F 2 and F 3 generations, but for most of the traits the importance of the non-additive gene effects was obvious. Therefore, the production of hybrid and the use of hetrosis can be helpful in genetic improvement of these traits. The parental genotype Saffire (from Canada) for early maturity and dwarfness and the parental genotype KH211 for seed oil content under both moisture conditions, and the parental genotypes K115 and E1449 in non-stress condition and the parental genotypes C129 and K115 in water stress condition for seed yield were the best general combiners. Since, Saffire and C129, respectively, showed acceptable values of general combining ability (GCA) for early maturity and seed yield, their progenies (Saffire × C129) also exhibited satisfactory values of specific combining ability (SCA) for days to maturity and seed yield under both moisture conditions. Thus, this segregated progenies of this cross was recognized as more promising population for genetic improvement of these traits in safflower in order to improve drought tolerance. In the second study, 21 safflower genotypes were used to assess their genetic potential for agronomic and morpho-physiological traits under two moisture conditions and to evaluate their tolerance to water deficit stress over two years. The results indicated that the effect of irrigation treatment and genotype on the traits was significant. On average, water deficit stress significantly decreased seed yield by 46.0%. Based on the principal components analysis, M420, A2, S149, E2428, and K21 genotypes were recognized with more tolerant to water stress and having high relative water content, proline content, catalase enzyme activity and maximum efficiency of photosystem ??. Therefore, these genotypes can be used in the safflower breeding programs to improve drought tolerance, and these traits are suitable physiological indicators for the identification of drought tolerance genotypes. In the third study, secondary metabolites of leaves, flowers, and seeds and phenolic and flavonoid compounds using chromatographic analysis (HPLC) were evaluated in two moisture conditions and their relationship with drought tolerance was investigated. Water stress had a significant effect on all of the secondary metabolites of leaves, flowers, and seeds, and the antioxidant activity of leaves and flowers were increased due to water stress, while those were decreased in seeds. A comparison of the antioxidant capacity of flowers and seeds with BHT (as a standard antioxidant) indicated that they had an acceptable antioxidant activity. Therefore, flowers and seeds of safflower have suitable compounds to be used in food and pharmaceutical industries as a natural antioxidant. Drought tolerance was correlated with total phenolic content (TPC) of leaves and seeds. Also, two common compounds in seeds and flowers, which were correlated with higher seed yield and STI were caffeic acid and quercetin. Keywords : Diallel, Drought tolerance, Genetic parameters, Safflower, Secondary metabolites