Leucaena (Leucaena leucocephala), a leguminous shrub promising to cope with feed scarcity in the tropics, may help in mitigating ruminal methane (CH4) emission in the tropics as well. Two experiments were conducted to evaluate the effect of Leucaena and major secondary compounds of this plant in ruminants. At first, effects of Leucaena tannins and mimosine on ruminal CH4 and nutrient degradability were tested in vitro. Incubations were made with Leucaena without or with polyethylene glycol (PEG) to exclude the tannins effects, as well as with Bermuda grass (Tifton) and lucerne hays, both either untreated or supplemented with mimosine at the same concentration that has been provided by the tested Leucaena (6.52 mg/g DM). Furthermore, in an in vivo experiment a control diet (per kg DM 700 g Tifton hay) and Leucaena diets (per kg DM 350 g Tifton hay and 350 g Leucaena), either with or without 20 g PEG/d per head, were evaluated in six Santa Inês sheep following a double Latin square design. In vitro, Leucaena resulted in the lowest (p < 0.05) gas and CH4 production and the highest (p < 0.05) partitioning factor, a measure for microbial efficiency, whereas the amount of truly degraded organic matter (TDOM) was lowest (p < 0.05) with Tifton among the experimental forage plants. Mimosine addition to lucerne and Tifton as well as PEG addition to Leucaena had no effect on ruminal CH4 and TDOM. In vivo Leucaena, compared to the Tifton diet, enhanced (p < 0.05) intake, faecal nitrogen excretion, body nitrogen retention and the excretion of urinary purine derivatives as an indicator for microbial protein synthesis and availability. This was independent of PEG addition. Leucaena also decreased (p < 0.001) CH4 emission per unit of digested organic matter by 14.1% and 10.8%, without and with PEG, respectively. No significant diet differences were observed in total-tract nutrient digestibility. The study demonstrated efficiency of Leucaena to mitigate in vivo methane emission of sheep, but did not reveal which constituent of Leucaena was primarily responsible for that since no clear efficiency of either tannins or mimosine could be demonstrated.