The objective of this study was to evaluate the effect of essential oil (EO) from Arnica montana as an additive on nutrient intake and digestibility, nitrogen balance, and rumen fermentation characteristics in feedlot lambs. Five ruminally cannulated Dorper × Santa Inês ram lambs, castrated, with 50.6 ± 1.19 kg of initial BW and 14.6 ± 1.28 month-old were distributed in a 5 × 5 Latin square design. All lambs were fed a basal diet (160.5 ± 3.06 g/kg DM of CP) containing 90 % concentrate and 10 % forage (Coastcross hay) to which the following 5 treatments were applied: 1. 0 mg/kg DM of OE from Arnica montana (A0), 2. 450 mg/kg DM of OE from Arnica montana (A450), 3. 900 mg/kg DM of OE from Arnica montana (A900), 4. 1350 mg/kg DM of OE from Arnica montana (A1350), 5. diet with 25 mg/kg DM of sodium monensin (positive control – MON). The levels of EO from Arnica montana did not alter the dry matter intake (DMI) and nutrient intake (DM, OM, CP, EE, NDF, ADF, NFC, and TDN). There was higher DM and nutrient intake for the EO from Arnica montana diets compared to MON (P < 0.05). For the comparison between MON vs. A0, there was a lower DMI and nutrients intake for MON (P < 0.05). Crude protein digestibility increased linearly (P = 0.03) in response to increasing levels of EO from Arnica montana in the diets. However, the digestibility of the other nutrients was not altered by the inclusion of EO from Arnica montana. There was no difference in nutrient digestibility for comparison between diets containing EO from Arnica montana vs. MON; and MON vs. A0. The inclusion of EO from Arnica montana in the diet linearly decreased (P = 0.03) nitrogen (N) in the urine, which was associated with a linear decrease (P = 0.03) in rumen ammonia concentration. The EO from Arnica montana contents linearly increased N retention (g/kg N intake and g/kg N absorption; P < 0.05). Diets with EO from Arnica montana had higher N intake and N excretion in urine compared to MON (P < 0.05). There was increased N retention for the diets with EO from Arnica montana when compared to MON (P = 0.02). In the contrast between MON vs. A0, there was lower N intake and lower N excretion via urine for MON (P < 0.05). The EO from Arnica montana contents conferred a quadratic effect (P = 0.03) on the molar ratio of acetate, with a lower concentration for A450. The total and individual concentrations of the other short-chain fatty acids (SCFA) were not affected by the inclusion of EO from Arnica montana. Total and individual SCFA concentrations did not differ between diets containing EO from Arnica montana vs. MON, nor between MON vs. A0. Rumen pH was not influenced by the inclusion of EO from Arnica montana in the diet, but there was a quadratic effect (P = 0.02) on the area under pH 5.5, with a greater area under 5.5 for A450. Diets with EO from Arnica montana had lower rumen pH when compared to MON (P = 0.01). The MON diet increased rumen pH compared to A0 (P < 0.01), this result contributed to a lower area under pH 5.5 and a higher total pH area for MON (P < 0.05). In conclusion, the 1350 mg/kg DM of EO from Arnica montana was the most promising, especially for the increased dietary N use efficiency, even when compared with sodium monensin.