In Exp. 1, 72 Targhee lambs (initial BW 22.1+/-.3 kg) were used to determine the effects of energy source (alfalfa pasture vs limit-fed, all-concentrate) and ionophore addition on performance, visceral organ mass, and carcass characteristics. There were no differences (P > . 10) in ADG or gain/ feed due to ionophore supplementation. Lambs that grazed alfalfa had greater (P < .05) liver, omasum, abomasum, small intestine, cecum, and large intestine weights than did lambs fed the concentrate diet. Lambs fed the concentrate diet had greater (P < .01) hot carcass weights, larger (P < .01) loin eye areas, and greater (P < .001) dressing percentages than lambs that grazed alfalfa. In Exp. 2, lambs offered the concentrate diet had greater (P < .001) DM and OM digestibilities than lambs offered alfalfa (89.5 and 91.1 vs 72.4 and 74.2%, respectively). Apparent and true N digestibilities were greater (P < .001) for the concentrate diet than for alfalfa (90.9 and 101.7 vs 77.7 and 91.9%, respectively). Likewise, grams of N retained per day were twice as great (P < .001) with the concentrate diet than with alfalfa (14.9 vs 6.0 g/ d). The greater visceral organ mass and resulting increases in energy and protein requirements in lambs that grazed alfalfa were probably responsible for the lesser hot carcass weight and dressing percentage compared with lambs fed 100% concentrate.