A half diallel cross among seven diverse rice genotypes was carried out in 2019 growing season. Parents and their 21 F₁ crosses were evaluated under normal (continuous flooding) and water deficit (irrigation every 12 days) conditions during 2020 growing season,to estimate general (GCA) and specific (SCA) combining ability effects as well as identifying type of gene action controlling the inheritance of the studied traits.Both GCA and SCA mean squares were highly significant for all the studied traits under normal and stress conditions. The non-additive gene action played an important role in the inheritance of all the studied traits, except leaf rolling under stress treatment. The parents Sakha 107, NERICA 9 and N22 were the best general combiners for grain yield/plant. The crosses Sakha 107×Giza 177, Sakha 107×Fuknishiki, NERICA 9×Giza 177, NERICA 9×Akihikari, N22 ×IET1444, N22×Fuknishiki and IET1444 × Giza 177 were identified as promising specific combiners for improving grain yield/plant and one or more of its components under both conditions. The genetic diversity among the seven parental genotypes was assessed using ten Simple Sequence Repeats (SSR) markers. A total of 33 alleles were detected ranging from 2 to 5 with an average of 3.3 alleles per locus. The PIC values ranged from 0.32 to 0.69, with an average of 0.51.Genetic distance ranged from 0.24 to 0.92 with an average of 0.63. High genetic diversity was detected among the tested genotypes at the molecular level, hence these genotypes could be exploited to improve water deficit tolerance in rice breeding program.