The extended use of the same variety by farmers over successive generations and reuse of the “seeds” caused natural variability that can be a magnificent opportunity for genetic improvement of tomatillo. Two successive seasons were accomplished to select genotypes with good performance from a heterogeneous population of the local tomatillo “Balady”. The results revealed significant differences in early yield as fruit number and average fruit weight over the original population. Additionally, the results revealed a highly significant correlation between fruit set percentage and total soluble solids (TSS) at 60 days and the marketable yield with fruit length and TSS at 60 days. In conclusion, the path analysis along with heritability and selection genetic gain showed that early yield and fruit set are the two most critical component traits for fruit yield in tomatillo. In addition, the average fruit weight showed a low indirect effect on fruit yield per plant. Twenty promising genotypes were selected as a kernel for pure line development through further breeding programs.