Agriculture is an important source of emission of the greenhouse gas nitrous oxide (N2O). The observed differences in N2O emission among different varieties of agricultural crops can be a key factor for developing N2O emission reduction strategies. N2O emissions were estimated from three varieties of wheat viz. Sonalika, DBW 39, and K 0307 during 2010-2011 in an attempt to identify plant physiological and anatomical factors contributing to differences in gas emissions within the varieties. Sonalika was identified as a low N2O emitting variety and DBW 39 as high emitting when grown in a uniform field condition. The experiment was repeated in 2011-2012 selecting low emitting Sonalika and high emitting variety DBW 39 for further confirmation of the results obtained during the first year of experimentation. Important plant factors namely rate of photosynthesis and transpiration in flag leaf, stomatal frequency of adaxial flag leaf surface, and size of the xylem vessels (mean vessel size of node, stem, and root) were studied, and their relationship with N2O flux was worked out. A good correlation between transpiration and N2O flux was observed in this study. Scanning electron microscopic investigation revealed strong association of flag leaf stomatal frequency and xylem size with N2O emission. Sonalika, identified as low N2O emitting variety during both the years of study, also recorded higher grain yield due to its higher efficiency of photosynthate allocation toward the developing grains. The observed differences in N2O emission are considered to be due largely to genetic differences in the wheat genotypes.