To study the effect of feeding calcium hydroxide-treated or vitamin E-supplemented cottonseed meal (CSM) incorporated diets on plasma gossypol, blood parameters and animal performance, 24 male Bikaneri lambs of 6-7 months of age and of uniform body weight were divided into four groups of six animals each in a completely randomized design and respectively fed isonitrogenous and isocaloric concentrate mixtures containing 20% soybean meal (CON) or 40% raw CSM (RCSM), 40% raw CSM supplemented with 500 IU of vitamin E per head per day (ERCSM), and 40%, 1.5% calcium hydroxide-treated CSM (CaCSM) along with ad libitum wheat straw throughout 510 days of experimental feeding. The lambs on all the diets grew linearly throughout the experimental period. The total weight gain, in turn the average daily gain (ADG), was not affected by dietary variations. The daily intake of dry matter, crude protein (CP), digestible crude protein (DCP) and total digestible nutrients (TDN) were found comparable among lambs of all the groups. Though total gossypol intake was similar in RCSM, ECSM and CaCSM groups, however, free gossypol intake was significantly higher (P < 0.01) in RCSM, ECSM groups as compared to CaCSM group. Serum iron and blood hemoglobin levels were significantly (P < 0.05) lower in RCSM group as compared to CaCSM and CON groups, and ALT activity was significantly (P < 0.05) higher on RCSM group as compared to other groups. Plasma gossypol and osmotic fragility of erythrocytes were significantly (P < 0.05) increased in RCSM group as compared to CaCSM and ERCSM groups. However, there was no significant difference in the concentration of other blood/serum biochemical constituents among the lambs on different groups. Based on the results, it may be concluded that feeding of 40% CSM in the concentrate mixture of the diet in Bikaneri lambs did not have any major adverse effect in blood parameters and animal performance. Either calcium hydroxide treatment or vitamin E supplementation did not produce any major additional benefits.