Drought and blast disease are the two major abiotic and biotic factors that severely reduce grain-yield (GY) of rice in rainfed-upland. Reproductive stage drought stress (RSDS) along with blast account for > 80% yield loss in rice. Identification of molecular markers for QTLs/genes (GY under RSDS and blast resistance) has opened up new avenues for developing new rice varieties with enhanced resistant/tolerant to these stresses. The current study focussed on introgression of QTL for GY under RSDS (qDTY12.1) and blast resistance gene Pi9 into an upland rice variety Nagina-22 (N-22). Foreground selection was carried out using previously reported markers corresponding to the QTL/gene. Background selection was carried out using 48 uniformly distributed SSRs. Finally, 27 BC2F3 lines (BLs), homozygous for qDTY12.1 and Pi9 were identified with background recovery of 87.5- 93.75%. These BLs were categorised into “tall” and “short” groups based on their plant height. Screening for blast resistance showed that all the BLs were highly resistant to blast [Standard Evaluation System (SES): 2–3], unlike the recurrent parent N-22 (SES = 6), which was susceptible. Similarly, these BLs were significantly tolerant to drought in comparison to N-22 (average yield advantage of 705kg/ha over N-22). Study of genetic parameters showed that five traits, namely, GY, DTF, PH, FGPP and SF% recorded high H2 values (> 60%) along with high GAM values (> 20%) (stress and non-stress), thereby strongly indicating the effectiveness of direct selection of these traits under contrasting moisture regimes. Correlation analysis indicated that DTF recorded positive and negative correlation with GY under non-stress and drought, respectively. Additionally, GY was positively correlated with PH, FGPP and SF%. Thus, plants having high FGPP, high SF% with short DTF and moderate PH may be selected for higher grain yield under RSDS. Thus, based on these criteria, the “short” BLs were found to be most suitable for farmer’s field and further selected for varietal trials.