Tall fescue (Lolium arundinaceum (Schreb.) Darbysh) is a valuable perennial pasture species, the productivity of which is increased by infection with endophytic fungi. However, toxins produced by the endophyte can cause fescue toxicoses, which are potentially detrimental to animal growth and health. It is desirable therefore, to develop non-ergot alkaloid producing endophytes which are not harmful to livestock. The purpose of this study was to compare cultivars of tall fescue with or without novel endophytes for their effect on lamb growth and productivity. Five tall fescue cultivar or endophyte treatments were sown into a randomised block design including three replicates. The treatments were Martin 2 (Mart; no endophyte, acting as a positive control), Kentucky-31 (KY-31; containing wild endophyte and acting as a negative control), Martin 2 with novel endophyte Protek™ (Mart Protek™), Tower with endophyte Protek™ (TowerProtek™) and DuraMax fescue with endophyte Series 9 (DuraMax 9). When established, composite lambs were allocated to the 15 plots and grazed the irrigated pastures in two successive periods of 42 (n = 150 lambs; summer) or 65 days (n = 150 lambs; autumn) between January and May 2012. Herbage quality was similar between treatments. Ergovaline was detected at low levels (<0.2 ppm) only in herbage from KY-31 plots. Lambs grazing novel endophyte treatments (Protek™ and Series 9) produced similar growth rates over both grazing periods to those grazing Martin 2 without endophyte (Mart). There were no treatment effects on the rectal temperatures of lambs within sampling dates. Plasma prolactin levels were lower (P < 0.05) for lambs grazing KY-31 (77 ng/mL and 4 ng/mL in the summer and autumn grazing periods, respectively) and DuraMax 9 (99 ng/mL and 13 ng/mL in each grazing period, respectively) treatments than those grazing other treatments, in both grazing periods. Endophyte Protek™ did not produce ergot alkaloids in sufficient quantities to limit lamb growth or suppress plasma prolactin levels. Based on plasma prolactin levels, the Series 9 endophyte may present a risk for fescue toxicoses, although further evaluation is required using genetic verification of endophytes. Lamb health and growth may not be reduced when grazing tall fescue with known toxic endophytes if weather conditions do not reach levels that induce heat stress. Some novel endophytes may pose toxicoses risk, so selection of pastures with an appropriate level of risk for the climate and animal management system will minimise risk.