Shearing is a common practice for lamb hygiene and health, which can also influence the animal survival and productivity in stressful environments. This study was conducted to investigate the effects of shearing on performance and some metabolic and physiological parameters of fattening lambs exposed to ambient heat stress. Thirty -two male Dalagh fattening lambs (32.4 ± 5.7 kg), 3.5 ± 0.5 months of age, were selected from a herd existing at the research station of the University of Gonbad Kavoos (temperate mild-latitude zone of Iran). Lambs were divided into two groups, maintained individually and fed with a mixture of alfalfa hay and concentrate with free access to drinking water. One group was completely shorn while the other group was left unshorn, and both groups were reared for 10 weeks (July–Sept.) with mean ambient temperature of 29.3°C. Feed intake and liveweight changes were recorded weekly whereas metabolic parameters were measured daily. Fasting blood samples were collected three times a week and used for blood metabolites and hormone assays. Results showed that shearing has no effects on feed intake and weight gain over the study. Feed conversion ratio was improved (P < 0.05) by shearing (10.70 vs 13.26 kg/kg). Shearing also caused a decline in lamb rectal temperature (P < 0.05), whereas heart rate remained unchanged. Respiratory rate was lower in shorn lambs (P < 0.001), whereas blood glucose, urea and total protein levels were not affected. Serum concentrations of thyroxine declined in shorn lambs compared with unshorn lambs (P < 0.05), but cortisol level was unchanged between groups. In conclusion, the study showed that when lambs are kept sheltered under heat stress conditions, shearing appears to induce energy retention via reducing some vital activities such as respiration and heat loss leading to enhanced feed efficiency. The decrease in thyroxine level can be considered as the possible underlying mechanism for the decline observed in rectal temperature.