Condition is assumed to reflect both genes and environment, enabling condition‐dependent signals to reveal genetic quality. However, because the phenotypic effects of variation in genetic quality could be masked by environmental heterogeneity, the contribution of genetic quality to phenotypic variation in fitness‐related traits and condition‐dependent signals remains unclear. We compared effects of ecologically relevant manipulations of environmental quality (nutrient dilution in the larval diet) and genetic quality (one generation of inbreeding) on male and female morphology, life history and reproductive performance in the neriid fly Telostylinus angusticollis. We found that larval diet quality had strong, positive effects on male and female body size, male secondary sexual traits, and aspects of male and female reproductive performance. By contrast, inbreeding had weak effects on most traits, and no trait showed clear and consistent effects of both environmental and genetic quality. Indeed, inbreeding effects on body size and male competitive performance were of opposite sign in rich vs. poor larval diet treatment groups. Our results suggest that environmental quality strongly affects condition, but the effects of genetic quality are subtle and environment‐dependent in this species. These findings raise questions about the genetic architecture of condition and the potential for condition‐dependent traits to function as signals of genetic quality.