The study on diversity in parents resulted in grouping of most of the parents in cluster I where the D2 value ranged from 1.70 to 1042.33. The highest intercluster distance was noticed between EC560413 and FQT-21and lowest distance was noticed between CSHH-198M and FQT-21. The per cent contribution to parental diversity was highest by seed index followed by seed cotton yield and lint index. Out of all the characters studied in F2 population, seed cotton yield, number of bolls per plant and mean boll weight showed high variation as indicated by the values of phenotypic and genotypic coefficients of variation. Therefore, practising of selection in these three traits in advanced generation is effective as indicated by their values of genetic advance over mean and heritability. In order to select genetically diverse parents, one should classify the materials on the basis of traits like seed cotton yield, boll weight, number of bolls, bundle strength and 2.5% span length.