Stress during the transition of beef steers from ranch to feedlot may depend on steer source and preconditioning. The interplay between physiological and behavioural patterns of preconditioned (PC) and auction-derived (AD) steers, particularly after commingling, is poorly understood. Our objective was to evaluate whether hair cortisol (HC) concentrations were related to the health and performance of PC and AD steers and study behavioural activities after commingling over six weeks in a feedlot. Steers, sourced either from ranch (PC, n = 250) or local auction (AD, n = 250), were assigned into 1 of 5 pens, 100% PC (100PC); 75% PC 25% AD (75PC); 50% PC 50% AD (50PC); 25% PC 75% AD (25PC), and 100% AD (0PC), each pen containing 100 steers. Pen was the experimental unit and individual steers were the observational unit where physiological and behavioural changes were measured. The study subsampled 225 steers (PC = 113 and AD = 112) which were equipped with CowManager ear tags to record behavious. On day 40, hair samples from each steer were collected by clipping hair close to the skin. Data were analyzed using multiple linear, logistic regression, or multilevel negative binomial regression models depending on the outcomes. There was no difference in HC concentrations (Day 40) between PC and AD steers (P = 0.66), and no association with Bovine Respiratory Disease (BRD)-related morbidity (P = 0.08) or average daily gain (ADG) (P = 0.44). After adjusting for source and commingling effects, HC concentrations did not affect time spent eating (P = 0.83), ruminating (P = 0.20), active (P = 0.89), or non-active (P = 0.32). PC steers spent more time eating and ruminating over Weeks 1 to 4 (P < 0.01) and Weeks 1 to 3 respectively (P < 0.05), and more time being active over Weeks 1 and 2 compared to AD steers (P < 0.001), but less time being non-active than AD steers on Weeks 1 to 3 (P < 0.001). Steers in 100PC and 50PC pens spent more time eating than steers in 0PC (P < 0.001), whereas steers in 25PC spent less time eating than steers in 0PC (P < 0.001). Steers in 0PC spent the most time being not active (P < 0.01). In conclusion, preconditioned steers spent more time eating, ruminating, and being active and less time being not active over the first three weeks in the feedlot, regardless of commingling. The HC concentrations did not identify potentially lower stress related to ranch transfer and were neither associated with BRD-related morbidity nor ADG.