Sorghum [Sorghum bicolor (L.) Moench] yield is limited by the coincidence of drought during its sensitive stages. The use of cerium oxide nanoparticles in agriculture is minimal despite its antioxidant properties. We hypothesize that drought-induced decreases in photosynthetic rate in sorghum may be associated with decreased tissue water content and organelle membrane damage. We aimed to quantify the impact of foliar application of nanoceria on transpiration rate, accumulation of compatible solutes, photosynthetic rate and reproductive success under drought stress in sorghum. In order to ascertain the mechanism by which nanoceria mitigate drought-induced inhibition of photosynthesis and reproductive success, experiments were undertaken in a factorial completely randomized design or split-plot design. Foliar spray of nanoceria under progressive soil drying conserved soil moisture by restricting the transpiration rate than water spray, indicating that nanoceria exerted strong stomatal control. Under drought stress at the seed development stage, foliar application of nanoceria at 25 mg L-1 significantly improved the photosynthetic rate (19%) compared to control by maintaining a higher tissue water content (18%) achieved by accumulating compatible solutes. The nanoceria-sprayed plants exhibited intact chloroplast and thylakoid membranes because of increased heme enzymes [catalase (53%) and peroxidase (45%)] activity, which helped in the reduction of hydrogen peroxide content (74%). Under drought, compared to water spray, nanoceria improved the seed-set percentage (24%) and individual seed mass (27%), eventually causing a higher seed yield. Thus, foliar application of nanoceria at 25 mg L-1 under drought can increase grain yield through increased photosynthesis and reproductive traits.