Breeding for drought tolerance is the most effective approach to mitigate drought effects. The prime goal of the current study was to identify potentially drought‐tolerant wheat (Triticum aestivum L.) genotypes. Therefore, an extensive collection of wheat genotypes (2,100) was evaluated under two water regimes, that is water deficit (WD, 50% ETc ‘crop Evapotranspiration’) and well‐watered (WW, 100% of ETc) across several environments in Egypt. The number of days to flowering (NDF), plant height (PH) and grain yield (GY) were recorded under both water regimes across environments. Additionally, three yield‐based drought indices and water‐use efficiency (WUE) were calculated for the top 30% yielding genotypes (that produced economical GY; 3.58 ton ha−1 for WD and 7.5 ton ha−1 for WW). The results indicated a significant effect for environments, water stress, and genotypes, as well as the second‐ and third‐order interactions across all traits. WD significantly reduced PH, NDF, and GY by 5.0 cm, 10.6 days and 50.0%, respectively. PH, NDF and GY were highly correlated. However, the direction and magnitude of correlation under normal conditions were different from those under WD. For example, under WW conditions, late flowering and taller genotypes tended to produce higher GY. In contrast, under WD, earlier and shorter wheat genotypes tended to produce higher GY. According to the drought tolerance index (DTI), 254 genotypes were considered drought tolerance (DTI > 1). Based on WUE, DTI and GY under WD, 80 genotypes outperformed the commercially grown Egyptian cultivars. Our results implied that the evaluated collection might be a valuable source not only for drought‐tolerant genotypes but also for highly yielding water‐efficient genotypes under favourable conditions in Egypt and similar geographic regions.