For 8 weeks, 64 Merino wethers, 18 months of age, were individually penned and offered 1 of 16 treatment feeds (n = 4). The 16 feeds were formulated to contain levels of added sodium chloride (0, 7, 14, 21%) and levels of organic matter digestibility (55, 62, 69, 76%), in a 4 × 4 factorial design. The treatment feeds were offered ad libitum for 7 weeks and at maintenance for the final week. Clean wool growth, corrected for digestible organic matter intake, increased by 16, 18 and 27% as added sodium chloride was increased (7, 14, and 21%). The increase in wool growth was similar for diets at all levels of formulated organic matter digestibility. Feed digestibility in sheep decreased when added dietary sodium chloride was 14% or higher. The decrease in organic matter digestibility was ~5 percentage units at the highest level (21%) of dietary sodium chloride. Liveweight gain in sheep was reduced from 143 to 134, 65 and 1 g/day with 7, 14 and 21% added dietary sodium chloride, respectively. Therefore, improvement in wool growth efficiency appears to occur at the expense of liveweight gain, and was probably related to a shift in digestion of feed from the stomach to the small intestine. Higher corrected clean wool growth associated with lower levels of purine derivatives (an indicator of microbial protein synthesis) supported the conclusion that increased dietary salt resulted in an increase in dietary protein being digested in the small intestine. A shift in feed utilisation towards increased wool growth as dietary salt increases may be a management tool of particular interest to specialist wool producers. In areas of saline land where salt-accumulating shrubs are often the most productive vegetation, an increase in wool production efficiency, even if liveweight is only maintained, may improve the profitability of incorporating these shrubs into a feeding strategy.