The onion (Allium cepa L.) belongs to the family Alliaceae and has paramount importance among vegetable crops around the globe. Salinity stress and the soil-borne fungus Fusarium oxysporum f. sp. Cepa (FOC), which is the cause of basal rot, are potentially hazardous factors related to the yield of onion crops. The present study was conducted in CRD using three replicates in in vitro conditions and in a greenhouse to investigate the impact of stress factors (salinity levels and FOC) (T1 = Negative control; T2 = Positive control (FOC); T3 = EC 2.5 dS m−1; T4 = EC 3.5 dS m−1; T5 = EC 4.5 dS m−1; T6 = EC 2.5 dS m−1 + FOC; T7 = EC 3.5 dS m−1 + FOC; and T8 = EC 4.5 dS m−1 + FOC) on the morphological, physiological, and yield parameters of onions. Fungal biomass, in the in vitro condition, increased at a salinity level of 2–8 dS m−1. In the greenhouse, the application of salinity levels, viz. 2.5, 3.5, and 4.5 dS m−1, and fungal pathogens exhibited a more severe impact on the severity of the disease, onion growth, and bulb compared to sole stress. Overall, the decreased levels of osmotic potential, total chlorophyll content, membrane stability index, and total protein were assessed in onion leaves, whereas total phenolics were enhanced in the mentioned stress conditions. Sugar contents were reduced due to the sole application of pathogens, whereas they were enhanced in the sole application of salinity stress and increased due to a combination of FOC and salinity level applications. Polyphenol oxidase (PPO) activity was not altered as a result of pathogen infection, while peroxidase (PO) and phenylalanine ammonia-lyase (PAL) contents were enhanced, and the activity of catalase (CAT) was reduced. Sole stress along with the combined application of salinity levels with fungal pathogens exhibited enhanced PO and PPO activity; in contrast, CAT and PAL activity decreased. In summary, onion crop cultivation in saline soil conditions increases the disease’s severity, which is caused by FOC. Furthermore, it is crucial to carry out field trials while considering these outcomes in order to support a strong strategy for reducing the tested stresses within a wider range of environmental conditions.