A comparative study of heterosis was made involving four female parents of Gossypium herbaceum L. and four male parents of each of G. herbaceum L. and G. arboreum L. These were evaluated to select donor parents for the exploitation of heterosis for different seed cotton yield, fibre quality traits and seed oil content. In the present study, superiority of the hybrids was observed over better parent and standard check Jayadhar for all the characters. The hybrids identified for high yield viz., RDC-53  MB-3200, KS-16  MB-3200, KS-16  MDL-2582, RAHS-14  MDL-2601, RAHS-14  DLSA-17 and RDC-88  DLSA-17 exhibited significant positive heterosis for seed cotton yield and fibre quality traits. However, hybrids failed to account heterosis over check Jayadhar for lint index and ginning out turn except few crosses viz., RAHS-14  MB-3200, RAHS-14  BLACH-1, RDC-88  BLACH-1, RAHS-14  DLSA-17, RDC-88  AK-235. Although superiority of intraspecific crosses for seed cotton yield was due to cumulative action of component traits like boll weight and number of bolls per plant, whereas boll number in interspecific crosses for better expression of heterosis of seed cotton yield in diploid cotton. However, in the present investigation for seed cotton yield in both sets of hybrids contribution of boll weight is relatively more than number of bolls per plant. The study was conducted at Main Agricultural Research Station, Dharwad during kharif 2006-07 to estimate combining ability involving four female parents of Gossypium herbaceum L. and four male parents of each of G. herbaceum L. and G. arboreum L. These were evaluated to select donor parents and hybrids for seed cotton yield and fibre quality traits along with agronomically superior varieties which were used in line  tester analysis for yield and yield components, economic traits and fibre quality traits. Analysis of variance for combining ability revealed that magnitude of SCA variance was greater than GCA variance for all the traits. This indicated predominance of non-additive gene action, which is important in exploitation of heterosis through hybrid breeding. The line  tester analysis for combining ability of four lines and eight testers are crossed to produce 32 F1s. The parents KS-16, 9747 and DLSA-17 for seed cotton yield and boll weight, RAHS-14, RAHS-131, MB-3200 and RDC-53 for 2.5 per cent span length and fibre strength were observed to be good general combiners. The crosses KS-16  BLACH-1, RDC-53  MB-3200, RDC-88  DLSA-17, RAHS-14  MDL-2601, KS-16  MDL-2582, RDC-53  MDL-2582 and RDC-88  DLSA-17 exhibited significant sca effects for seed cotton yield per plant. In general, RAHS-14, KS-16 and RDC-88 exhibited good general combining ability for most of the yield and fibre quality traits.