Climate change, water scarcity, population growth, and food shortage are some of the threatening challenges being faced in today’s world. Among different types of stresses, drought stress presents a persistent challenge for global food production, however, its harshness and intensity are supposed to expand in the imminent future. The most striking effects of drought stress on plants are stunted growth, severe damage to photosynthetic apparatus, reduction in photosynthesis, reduction in seed germination, and nutrient uptake. To deal with the destructive effect of drought stress on plants, it is necessary to consider its effects, mechanisms of action, the agronomic and genetic basis for sustainable management. Therefore, there is an urgent need for sustainable solutions to cope up with the negative impact of drought stress. This review focuses on the detrimental effects of drought stress on plants’ morphological, physiological, and biochemical characteristics and recommends suitable drought management techniques to reduce the severity of drought stress. We summarize the effect of drought stress on physiological and biochemical parameters (such as germination, photosynthesis, biomass, water status, and nutrient uptake) and yield. Overall, in this article, we have reviewed the role of different phytohormones, osmolytes, exogenous compounds, proteins, plant growth-promoting microbes (PGPM), omics approaches, and genome editing technologies like clustered regularly interspaced short palindromic repeats (CRISPR) and CRISPR-associated protein 9 (CRISPR-Cas9) in alleviating drought effects in plants. We also proposed that developing drought-tolerant plant varieties requires the combined use of biotechnological and agronomic approaches and cutting-edge genome editing (GE) tools.