Inbreeding is expected to decrease the heritability within populations. However, results from empirical studies are inconclusive. In this study, we investigated the effects of three breeding treatments (fast and slow rate of inbreeding – inbred to the same absolute level – and a control) on heritability, phenotypic, genetic and environmental variances of sternopleural bristle number in Drosophila melanogaster. Heritability, and phenotypic, genetic and environmental variances were estimated in 10 replicate lines within each of the three treatments. Standard least squares regression models and Bayesian methods were used to analyse the data. Heritability and additive genetic variance within lines were higher in the control compared with both inbreeding treatments. Heritabilities and additive genetic variances within lines were higher in slow compared with fast inbred lines, indicating that slow inbred lines retain more evolutionary potential despite the same expected absolute level of inbreeding. The between line variance was larger with inbreeding and more than twice as large in the fast than in the slow inbred lines. The different pattern of redistribution of genetic variance within and between lines in the two inbred treatments cannot be explained invoking the standard model based on selective neutrality and additive gene action. Environmental variances were higher with inbreeding, and more so with fast inbreeding, indicating that inbreeding and the rate of inbreeding affect environmental sensitivity. The phenotypic variance decreased with inbreeding, but was not affected by the rate of inbreeding. No inbreeding depression for mean sternopleural bristle number was observed in this study. Considerable variance between lines in additive genetic variance within lines was observed, illustrating between line variation in evolutionary potential.