The effects of dietary supplementation with Azolla pinnata (a macro algae) on lamb performance, blood parameters, carcass traits and meat quality were investigated. Thirty fat-tail uncastrated male Moghani lambs with an initial average body weight (BW) of 28 ± 1.4 kg were allocated to one of three dietary treatments (10 lambs/treatment) by stratified randomisation based on BW. Lambs were fed ad libitum for 90 d with a standard finishing diet containing sun-dried Azolla at 0, 10 and 20% (DM basis) levels. Results showed that the feed intake tended to be lower (P = 0.074) in Azolla supplemented lambs, the values were 1.73 and 1.69 and 1.48 kg DM/d, for 0, 10 and 20% Azolla, respectively. Plasma urea and creatinine concentrations were lower in Azolla supplemented lambs than control group (P < 0.05). BW was not affected by dietary supplementation of Azolla (P > 0.05) but inclusion of Azolla in the feedlot ration improved (P = 0.004) feed conversion ratio. Hot and cold carcass weights were greater (P = 0.009) for lambs fed with 10% Azolla (24.9 and 24.4 kg), than for the control group (22.5 and 22.1 kg, respectively). Other carcass traits and longissimus dorsi muscle chemical composition were not impacted by Azolla supplementation (P > 0.05). Lambs that were supplemented with 20% Azolla in the feedlot ration had greater odor intensity scores (P = 0.01) compared with the control group. The sensory properties of meat were not altered by 10% Azolla diet. Azolla supplementation at 10% and 20% had no effect on meat quality attributes (P > 0.05). From these results, the supplementation of Azolla pinnata at 10% level is recommended as a feed source to improve feed conversion ratio and carcass weights for Moghani lambs, without compromising meat quality and sensory properties.