The production of wheat, a major essential crop in Pakistan and around the world, is declining for a variety of biotic and abiotic reasons even though the area under farming increases each year. Drought is primarily brought on by water scarcity and climatic shifts, both of which have a negative impact on the yield and production of wheat around the world. Applying biological fertilizers may help to relieve drought. In the present research, three melatonin foliar treatments—MN0 = 0 uM, MN1 = 50 uM and MN2 = 100 uM—were used to reduce the negative impacts of drought on wheat at three key development phases, namely tillering (DTS), blooming (DFS), and grain filling stage (DGFS), in a drought conditions. Wheat growth and production traits were substantially harmed by drought stress at all important development stages, with DGFS stage being the most vulnerable and leading to a sizable yield loss. But foliar melatonin (MN) application significantly lessened the negative effects of drought as compared to the control treatment by increasing plant height (15.74%), fertile tiller count (18.14%), spike length (17.61%), grain count per spike (14.89%), thousand grain weight (11.4%), and biological yield (13.1%). Additionally, MN boosted the metabolic metrics of wheat under dry conditions and increased water utilization efficiency. Using principal component analysis, which links various aspects of our data, we were able to describe how MN treatment impacted wheat development and output under dry circumstances. MN at 100 uM is the useful strategy for reducing the negative impacts of dry stress on wheat crop production.