Pearl millet [Pennisetum glaucum (L.) R. Br.] is a climate‐resilient cereal crop widely grown in arid and semiarid environments and an important crop for food, fodder, and nutritional security. This study was aimed at evaluating genetic variation(s) for drought tolerance‐related traits in a set of 29 seed (B) and 27 restorer (R) lines and identifying pearl millet inbreds for hybrid development. Field experiments were conducted in a split‐plot in randomized complete block design with three replications for 2 years. Moisture regimes (irrigated and rainfed) were kept as main plot treatments, and the genotypes were used as subplot treatments. Principal component analysis and neighbor joining clustering revealed the presence of greater genetic diversity between B and R lines. Combined analysis of variance showed significant difference(s) between the lines, treatments, and years. Genotype + genotype × environment interaction biplot indicated the significant environment and treatment effect(s) on grain yield per plant, number of seeds per plant, and 1000‐grain weight. Rank summation index based on percentage reduction and multi‐trait stability index analyses for the above three traits identified the best adapted genotypes for rainfed conditions. Based on these analyses, seven seed parents (ARCH41B, ARCH01B, ARCH13B, ARCH44B, ARCH09B, ARCH24B, and ARCH30B) and six pollinators (ARCH36R, ARCH68R, ARCH22R, ARCH63R, ARCH50R, and ARCH60R) were identified as potential parents to develop high‐yielding and drought‐tolerant pearl millet hybrids for the semiarid tropics.