Norway has vast rangeland resources (292,361 km2) with an estimated carrying capacity of nearly four million sheep and lambs, twice the current number. However, the intensive production system currently applied has led to more concentrate dependency, resulting in heavier animals in addition to poorer utilization of rangelands and homegrown feed. Intensive feeding systems indirectly influence the sustainability of ecosystems by promoting intensive cropping that can deplete soil fertility and threaten landscape preservation and biodiversity. By contrast, extensive grazing systems can produce environmentally and animal-friendly food products and contribute to regulating soil health, water and nutrient cycling, soil carbon sequestration, and recreational environments. In this paper, the economics of current sheep feeding practices in Norway, using a linear programming model, were compared with more extensive systems which allow for higher usage of on-farm feed resources. Changes in current sheep farming practices have the potential to increase lamb meat production relative to mutton production, in addition to improving the year-round supply of fresh meat. The investigated alternatives, using the Norwegian White Sheep (NWS) breed, suggest that delayed lambing is useful only on farms with abundant pastures available for autumn feeding. Lambs achieve a better market price than hoggets and mature sheep. Therefore, based on the current Norwegian meat market and price offered per kilogram of meat for lamb, an increase in NWS lamb production improves farm profits. On the other hand, when the aim is on greater use of homegrown feed and rangelands, this can be achieved through hogget production, and the quantity of concentrates required can be reduced substantially.