Maize, a major food source for the world’s tropical regions, is often impaired by droughts under a changing climate, which creates the importance of making efforts to improve the tolerance characteristics of maize under field conditions. The experiment was conducted during the dry season of the 2020–2021 period to investigate the stimulatory effects of plant growth regulator (PGR) ethephon (2-chloroethylphosphonic acid) on the morpho-physio-biochemical traits of maize and to identify suitable application approaches for efficient production under water stress. The factorial randomized complete block design was followed for the present experiment. Ethephon was applied at the vegetative 6 leaves (V6) and/or 10 leaves (V10) stages. Seven application approaches (doses in g a.i. ha−1) of ethephon, i.e., 281 at the V6 stage (E1), 281 at the V6 stage + 281 at the V10 stage (E2), 281 at the V10 stage (E3), 562 at the V6 stage (E4), 562 at the V6 stage + 562 at the V10 stage (E5), 562 at the V10 stage (E6), and no ethephon (E7), were used for maize production. Another factor was that three water levels were used, i.e., well-watered conditions (watering every week) (W1), short water stress (no watering during 48–69 days after planting) (W2), and prolonged water stress (no watering during 48–83 days after planting) (W3). Water stress negatively affected most of the morpho-physiological traits, and in W2 and W3 conditions, the grain yield was significantly lower, i.e., 4.82 and 4.27 t ha−1, respectively, compared to W1 (5.71 t ha−1). The plant height and leaf area index at the reproductive milk stage of maize (R3) were significantly reduced by all approaches of ethephon application compared to no ethephon. However, across the water levels, E3 performed better and produced a higher grain yield (5.11 t ha−1), which was mostly seen by a higher 100-grain weight (24.52 g) and a slightly higher grain number per plant (356.12). It was also positively supported by most of the physiological and biochemical traits, as they were especially higher in the relative growth rate (25.73 mg plant−1 day−1), net assimilation rate (0.79 mg cm−2 day−1) at V6-R3, heat use efficiency (3.39 kg ha−1 °C days−1), electrolyte leakage (5.69%), and proline (28.78 µmol g−1 FW). These traits, under prolonged stress, also gave the maximum drought tolerance index by E3, i.e., the relative growth rate (1.00) and net assimilation rate (1.00) at V6 to R3, heat use efficiency (1.06), relative water content (1.00), electrolyte leakage (1.65), proline (1.88), 100-grain weight (1.01), grain yield (1.11), and water productivity (1.53). A path analysis showed that the shoot weight at R3 (1.00), the stem diameter at the R3 stage (1.00), net assimilation rate (0.95), relative water content (0.95), 100-grain weight (0.90), grain number (0.76), proline (0.75), SPAD value (0.71), and total soluble sugar (0.57) were highly positive, and electrolyte leakage (−0.84) was negatively correlated with the grain yield under prolonged water stress. The maximum positive direct effect on the grain yield was found in the shoot weight (1.05), net assimilation rate (0.68), leaf area index at R3 (0.45), SPAD (0.22), and electrolyte leakage (0.21). The ethephon application as the E3 approach was more efficient in both short and prolonged stress, especially under prolonged stress, as it showed a higher energy use efficiency (1.55) and less CO2-eq emission (3603.69) compared to the other approaches of ethephon. The subsequent efficient ethephon approaches were E1 under short water stress, E6 under prolonged water stress, where E5 performed minimally, and no application of ethephon, which exhibited the worst efficiency under water stress.