In self-pollinating populations, individuals are characterized by a high degree of inbreeding. Additionally, phenotypic observations are highly influenced by genotype-by-environment interaction effects. Usually, Bayesian approaches to predict breeding values (in self-pollinating crops) omit genotype-by-environment interactions in the statistical model, which may result in biased estimates. In our study, a Bayesian Gibbs sampling algorithm was developed that is adapted to the high degree of inbreeding in self-pollinated crops and accounts for interaction effects between genotype and environment. As related lines are supposed to show similar genotype-by-environment interaction effects, an extended genetic relationship matrix is included in the Bayesian model. Additionally, since the coefficient matrix C in the mixed model equations can be characterized by rank deficiencies, the pseudoinverse of C was calculated by using the nullspace, which resulted in a faster computation time. In this study, field data of spring barley lines and data of a ‘virtual’ parental population of self-pollinating crops, generated by computer simulation, were used. For comparison, additional breeding values were predicted by a frequentist approach. In general, standard Bayesian Gibbs sampling and a frequentist approach resulted in similar estimates if heritability of the regarded trait was high. For low heritable traits, the modified Bayesian model, accounting for relatedness between lines in genotype-by-environment interaction, was superior to the standard model.