Jaffna Local is an endangered indigenous sheep population in the island country of Sri Lanka. The present study was aimed at assessing genetic diversity of Jaffna Local sheep and its relationship with major South Indian breeds. A total of 320 sheep were genotyped at 19 short tandem repeat marker loci and sequenced for mitochondrial DNA (mtDNA) control region to assess population structure, genetic admixture and phylogeography. The results revealed Jaffna Local sheep having relatively low diversity and high estimated inbreeding coefficient as compared to major South Indian breeds. The results of genetic distance estimations, AMOVA and Bayesian analysis clearly indicated relatively closer genetic relationship of Jaffna Local sheep with Southern Tamil Nadu sheep breeds (Vembur, Kilakarisal) and Mandya as compared to other South Indian breeds. Analysis of mtDNA control region revealed 16 haplotypes in Jaffna Local sheep, of which four were observed to be singletons and specific to this breed. The maternal lineages of all the Jaffna Local and South Indian sheep belonged to haplogroup A (HPG-A). Sequence mismatch analysis revealed uni-modal distribution in Jaffna Local sheep indicating haplotype expansion. Considering Jaffna Local sheep is the only defined breed of Sri Lanka, it is imperative to implement selective breeding program in the native tract to prevent genetic dilution and foster conservation of this important indigenous genetic resource of Sri Lanka.