The allelopathic water extracts (AWEs) may help improve the tolerance of crop plants against abiotic stresses owing to the presence of the secondary metabolites (i.e., allelochemicals). We conducted four independent experiments to evaluate the influence of exogenous application of AWEs (applied through seed priming or foliage spray) in improving the terminal heat and drought tolerance in bread wheat. In all the experiments, two wheat cultivars, viz. Mairaj‐2008 (drought and heat tolerant) and Faisalabad‐2008 (drought and heat sensitive), were raised in pots. Both wheat cultivars were raised under ambient conditions in the wire house till leaf boot stage (booting) by maintaining the pots at 75% water‐holding capacity (WHC). Then, managed drought and heat stresses were imposed by maintaining the pots at 35% WHC, or shifting the pots inside the glass canopies (at 75% WHC), at booting, anthesis and the grain filling stages. Drought stress reduced the grain yield of wheat by 39%–49%. Foliar application of AWEs improved the grain yield of wheat by 26%–31%, while seed priming with AWEs improved the grain yield by 18%–26%, respectively, than drought stress. Terminal heat stress reduced the grain yield of wheat by 38%. Seed priming with AWEs improved the grain yield by 21%–27%; while foliar application of AWEs improved the grain yield by 25%–29% than the heat stress treatment. In conclusion, the exogenous application of AWEs improved the stay green, accumulation of proline, soluble phenolics and glycine betaine, which helped to stabilize the biological membranes and improved the tolerance against terminal drought and heat stresses.