Two sets of diallel crosses involving seven tetraploid and five hexaploid alfalfa lines, previously selected for seed and forage yield, are studied. On the basis of combining ability and heritability estimates the following conclusion is drawn. The dominant and epistatic interactions (heterozygosity) are the major components in the expression of variability for yield and characters associated with yield in tetraploid populations. In hexaploid populations, however, there is an appreciable amount of additive variance, and the additive effect of genes along with interaction of various forms may account for the expressed variability for all the characters studied. Better genes and desirable interactions (possibly through heterozygosity) are the two essential genetic components of yield. The selection of better genes is feasible, but by itself will not produce the desired results. Future improvement may therefore depend on the utilization of heterosis and other forms of interactions. There is, in general, a very strong genetic correlation between yield and its components, and therefore, when a direct selection for yield is not feasible, the selection program may rely on a number of closely related characters.