The effect of melatonin (MT) on potato plants under drought stress is still unclear in the available literature. Here, we studied the effect of MT as a foliar application at 0, 0.05, 0.1, and 0.2 mM on potato plants grown under well-watered and drought stressed conditions during the most critical period of early tuberization stage. The results indicated that under drought stress conditions, exogenous MT significantly (p ≤ 0.05) improved shoot fresh weight, shoot dry weight, chlorophyll (Chl; a, b and a + b), leaf relative water content (RWC), free amino acids (FAA), non-reducing sugars, total soluble sugars, cell membrane stability index, superoxide dismutase (SOD), catalase (CAT), guaiacol peroxidase (G-POX), and ascorbate peroxidase (APX) compared to the untreated plants. Meanwhile, carotenoids, proline, methylglyoxal (MG), H2O2, lipid peroxidation (malondialdehyde; MDA) and abscisic acid (ABA) were significantly decreased compared to the untreated plants. These responses may reveal the protective role of MT against drought induced carbonyl/oxidative stress and enhancing the antioxidative defense systems. Furthermore, tuber yield was differentially responded to MT treatments under well-watered and drought stressed conditions. Since, applied-MT led to an obvious decrease in tuber yield under well-watered conditions. In contrast, under drought conditions, tuber yield was substantially increased by MT-treatments up to 0.1 mM. These results may imply that under water deficiency, MT can regulate the tuberization process in potato plants by hindering ABA transport from the root to shoot system, on the one hand, and by increasing the non-reducing sugars on the other hand.