The considerable impact of disease outbreaks on commercial shrimp farming during the last two decades has significantly affected the operational management of shrimp farms worldwide. Crop losses forced shrimp producers to look for more sustainable culture practices and facility designs to minimize the risk associated with exposure to viral pathogens. Shrimp culture under limited discharge can increase biosecurity and minimize losses to disease outbreaks while reducing negative environmental impact. A 71-day nursery study was conducted in greenhouse-enclosed raceways to evaluate the effect of two water exchange regimes and the use of foam fractionators on selected water quality indicators, growth, survival, and health of Litopenaeus vannamei postlarvae (PL). Four 40m3 raceways were stocked with 4–5-day-old PL at a density of 4050PLm−3. All raceways were equipped with high pressure rapid sand filter, a pump, a center longitudinal partition over a 5.1cm PVC pipe with nozzles, eighteen 5.1cm airlift pumps, six 1m long air diffusers and a 5.1cm Venturi injector. Two out of the four raceways were each equipped with a home-made foam fractionator (FF). Average water usage in the two raceways operated with FF was 3.35%d−1 compared to the 9.37%d−1 used in the other two. Shrimp in the raceways operated with FF and the lower water exchange had greater mean final weight (1.91 and 2.0g vs. 1.73 and 1.43g), survival (100 and 92.4% vs. 55.9 and 81.8%), yield (7.64 and 6.89kgm−3 vs. 3.92 and 4.74kgm−3) and FCR (0.97 and 1.06 vs. 1.36 and 1.64) values than those operated without FF and with higher water exchange rate. Disease diagnostic results showed no signs of viral pathogen infection. Histological observations of samples collected at the study termination suggest that the shrimp raised in the higher water exchange raceways had greater external fouling and higher intestinal bacterial load than those maintained at lower water exchange. Nitrite–nitrogen was significantly lower in the reduced water exchange than the higher exchange raceways, whereas reactive phosphorus, turbidity, and algal density were significantly higher. No other differences in water quality were found between treatments. This study demonstrated the feasibility of producing healthy juveniles of the Pacific white shrimp under limited discharge conditions in tanks operated with foam fractionators with good growth, survival, yield and FCR results.