Sorghum [Sorghum bicolor (L.) Moench] is the king of cereal crops in the arid and semiarid tropics, where drought is a recurrent problem affecting crop production because of erratic amount and distribution of rainfall. Although sorghum has a genetic potential to withstand the effect of drought, it is being affected by the current climate change scenarios. The present experiment was conducted with the view of assessing sorghum variability to transpiration efficiency, and association among traits using 101 sorghum genotypes in greenhouse facility at Melkassa Agricultural Research Center during 2021/22. The design of the experiment was RCBD with two replications. Data analyses were computed using SAS 9.4. The analysis of variance showed significant difference among genotypes for all traits considered, indicating the presence of considerable genetic variability among tested genotypes. High heritability coupled with high genetic advance as percentage of the mean (GAM) was recorded for plant transpiration efficiency and shoot transpiration efficiency. Moderate heritability coupled with high GAM were recorded for total dry biomass, shoot dry biomass, root dry biomass, shoot fresh biomass, water use, and leaf area, suggesting the possibility of improving these traits through direct selection. Correlation analysis revealed that plant transpiration efficiency had positively significant genotypic and phenotypic correlations with shoot transpiration efficiency, total dry biomass, shoot fresh biomass, root dry biomass, shoot fresh biomass and leaf chlorophyll content. Path coefficient analysis showed that total dry biomass was directly affected by plant transpiration efficiency, shoot transpiration efficiency, shoot fresh biomass, leaf chlorophyll content, leaf area, water use and leaf number. Cluster analysis grouped genotypes into six clusters. The maximum inter-cluster distance was between cluster II and cluster V, suggesting the possibility of improving genotypes through hybridization. The four principal components with eigenvalues greater than one accounted for about 79% of the total variation among genotypes, indicating that the traits considered were appropriate to detect variation among tested genotypes. Overall, the present study indicates the presence of considerable genetic variability to improve transpiration efficiency of sorghum and to develop adaptable and heigh yielder sorghum varieties for drought stress environment.