To study the effects of drought stress and nitrogen fertilizer levels on some physiological traits and grain yield of two red kidney bean genotypes, a field experiment as split factorial arranged in randomized complete blocks design with three replications was carried out at Research Field of Faculty of Agriculture, University of Tehran, Karaj, Iran in 2010. The main plots were three irrigation levels (irrigation after 60, 90 and 120 mm evaporation from open pan class A) and factorial combinations of N fertilizer at four levels (0, 50, 100, and 150 kg N ha-1) and two red bean genotypes (Akhtar and D81083) were assigned in sub-plots. Results showed that drought stress×genotype interaction was significant (p£0.01) on total chlorophyll and chlorophyll a, proline content and canopy temperature depression (CTD). Similarly, the drought stress×nitrogen fertilizer interaction was significant (p£0.01) on chlorophyll a, b and total, proline content and CTD). Results indicated that drought stress reduced grain yield, LAI, leaf water content, chlorophyll a, b and total and carotenoids, but increased CTD and proline content. However, nitrogen fertilizer application increased all of the measured traits except the canopy temperature. Akhtar red bean cultivar showed higher carotenoid, proline, leaf water content and canopy temperature whereas the D81083 genotype produced higher grain yield under the drought stress conditions.Generally, application of nitrogen fertilizer increased LAI, leaf water content, pigment content, proline content and grain yield of red kidney bean and led to reduction in canopy temperature in drought stress conditions.