Crop genetic engineering mostly aims at improving environmental stress (biotic and abiotic) tolerance as well as nutritional quality. Empowering a single crop with multiple traits is highly demanding and requires manipulation of more than one gene. However, we report improved drought tolerance and fungal resistance along with the increased iron and polyunsaturated fatty acid content in tomato by expressing a single gene encoding C-5 sterol desaturase (FvC5SD) from an edible fungus Flammulina velutipes. FvC5SD is an iron binding protein involved in ergosterol biosynthesis. Morphological and biochemical analyses indicated ≈23% more epicuticular wax deposition in leaves of transgenic plants that provides an effective waterproof barrier resulting in improved protection from drought and infection by phytopathogenic fungus Sclerotiniasclerotiorum. Furthermore, the transgenic fruits have improved nutritional value attributed to enhanced level of beneficial PUFA and 2-3 fold increase in total iron content. This strategy can be extended to other economically important crops.