Complete F1 and F2 diallel crosses were used to investigate the inheritance of yield among eight Ugandan bread wheat lines grown in two low-yielding environments; one marginal because of the high incidence of yellow rust normally experienced there, the other a low-rust site. In the marginal, high-rust environment, mainly additive genetic variation was present, though in one season, when disease incidence was unusually low, non-additive variation due to dominance was also detected. Although yield was significantly higher at the low-rust site, no clear pattern of inheritance was apparent there. The results indicated that the low rust site was an intermediate environment, just below the crossover point of a crossover genotype-environment interaction. The implications of these results for wheat breeding in low-yielding and marginal environments in Uganda and elsewhere are discussed.