Effect of feed restriction in the early life of young Merino sheep on growth performance and wool characteristics. The effect of feed restriction on the relative performance of young Merino sheep was investigated. Lambs were separated from their mothers between 24 and 48 h postpartum, divided into four random groups and artificially reared. Restriction was brought about by two commercial milk substitutes, viz. a calf (13% fat) and a lamb milk substitute (21% fat), each made available to the lambs at two different levels (ad libitum – 8 kg vs. restricted – 4 kg DM). The lamb and calf milk substitutes contained approximately 18,5% and 13,1% total solids respectively, on a liquid basis. The lambs were weaned on 30 ± 2 days and placed on a diet of commercial lamb creep feed pellets. No treatment effects were tested after weaning and lambs were reared under identical feed and environmental conditions. A significant difference (P < 0,05) in average daily live weight gain (ADG) between treatment groups from birth to weaning was recorded. ADGs of 73 g/d (restricted) and 161 g/d (ad libitum milk) were recorded. The restricted groups reached their original weaning mass within 5,4 days (P < 0,01) after weaning, compared with the 16,6 days of the ad libitum milk groups. Up to 15 kg live mass, lambs in the restricted groups had consumed 16% (P < 0,01) more creep feed than lambs in the ad libitum milk groups. Although the restricted groups produced significantly (P < 0,05) less greasy wool at six months of age, no difference in greasy wool production was recorded at 18 months of age. Significantly (P < 0,05) higher clean fleece masses were, however, produced by the group which received lamb milk substitute as well as the restricted groups.