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ABSTRACT Soybean ( Glycine max [L.] Merr.) productivity is often constrained by high flower abortion rates, especially under drought stress conditions, where up to 80% of flowers fail to develop into pods. This study aimed to assess the physiological and reproductive responses of eight soybean lines under controlled water‐deficit stress and recovery conditions to identify lines with improved flowers and pods retention. The experiment was conducted in a greenhouse using a dry‐down and rewatering protocol, followed by validation under field conditions across two growing seasons, 2023 and 2024. Eight lines were grown in a greenhouse where pots were sealed to prevent evaporation, and plants were allowed to gradually transpire the full amount of water in each pot before being re‐watered. The fraction of transpirable soil water (FTSW) and normalised transpiration rate (NTR) were monitored using a gravimetric method for all lines. Physiological parameters including stomatal conductance, transpiration rate, and quantum yield of fluorescence (ΦPSII) were recorded. Flower numbers and wilting scores were recorded daily, and pod numbers were assessed at harvest. Significant genotypic variation was observed in response to water‐deficit stress. PI506862 and PI423926 exhibited a strong stress adaptive response of early stomatal closure with high FTSW thresholds of 0.65 and 0.69, respectively, lower wilting scores, and rapid transpiration and ΦPSII activity during the rewatering recovery phase. PI506862 had high flower retention and pod setting during the recovery phase in greenhouse (17 pods/plant) and field trials (up to 146–193 pods/plant). In contrast, PI567638 had the lowest FTSW threshold (0.43), highest wilting scores, and poor recovery (4 out of 5 plants did not survive the dry‐down phase) and failed to produce pods after rewatering. These findings emphasise the presence of significant phenotypic variations in drought induced flower abortion and highlight PI506862 as a promising donor for breeding drought tolerant soybean line with enhanced productivity.