A field experiment was conducted to evaluate the correlation and path analysis in thirty horse gram germplasm lines under moisture-stressed conditions using various selected characters. The association studies revealed a significant positive correlation of seed yield with relative water content, number of pods per plant, number of seeds per pod, total chlorophyll content, harvest index, proline content, root dry weight, root length and leaf area index. While days to 50% flowering, days to maturity, plant height and number of primary branches showed a significant negative correlation with yield. Path coefficient analysis revealed a high positive direct effect of the number of pods per plant on seed yield and the number of seeds per pod recorded exhibited the highest indirect effect on seed yield via the number of pods per plant under moisture stress conditions in horse gram. So, selection based on the number of pods per plant will be more beneficial under water stress conditions. The exploitation of genetic diversity is key to a successful breeding program. The principal component analysis using selected fifteen characters revealed the existence of adequate genetic variability among genotypes under study. First four principal components accounted for a cumulative variance of 82.47%. The principal component analysis (PCA) biplot revealed genotypes viz. IC22785, IC392329, HG 26L and IC20753 to highly diverse and these genotypes may be employed for enhancement of various traits in horse gram.