Drought is a major constraint to canola production around the world. There is potential for improving crop performance in dry environments by selecting for transpiration efficiency (TE). In this work we investigated TE by studying its genetic association with carbon isotope discrimination (Δ) and other traits, e.g. specific leaf weight (SLW) and leaf chlorophyll content (SPAD). Among the 106 canola genotypes - including open-pollinated, hybrid, inbred types and cytoplasmic variants - tested in the field and glasshouse there was significant genotypic variation for TE, Δ, plant total dry weight, SLW and SPAD. Strong negative correlations were observed between TE and Δ (-0.52 to -0.76). Negative correlations between Δ and SLW or SPAD (-0.43 to -0.78) and smaller but significant positive correlations between TE and SLW or SPAD (0.23 to 0.30) suggested that photosynthetic capacity was, in part, underpinning the variation in TE. A cytoplasmic contribution to genetic variation in TE or Δ in canola was also observed with Triazine tolerant types having low TE and high Δ. This study showed that Δ has great potential for selecting canola germplasm with improved TE.