The effect of diets with different levels of partly destoned exhausted olive cake (PDEOC) on growth performance and carcass traits of Gentile di Puglia breed lambs was studied. Sixty lambs (16.5 +/- 0.5 kg) at weaning were randomly allocated to 3 isocaloric and isonitrogenous diets for 50 d. Pelleted total mixed rations (TMR) were formulated to provide olive by-product at 3 different levels: 1) a control diet without olive by-product (PDEOC-0), 2) an experimental corn-based diet containing 10% by-product (PDEOC-10) replacing part of the oat hay and sunflower meal, and 3) an experimental corn-based diet containing 20% PDEOC (PDEOC-20) replacing part of the oat hay and soybean meal. To evaluate in vivo digestibility of the diets, adult rams (n = 3) were placed in metabolic cages, their individual feces and urine were collected, and differences were observed for DM and fiber fractions. Results from the growth trial of the lambs showed that performance was influenced by olive by-product inclusion in diet (P < 0.05). At the end of the feeding period, lambs were slaughtered, and none of the variables studied were influenced by dietary treatment except for cold carcass dressing (P = 0.027) and half-carcass weight (P = 0.019), which were improved in lambs fed the PDEOC-20 diet. As a result, the current study confirms that olive by-product can be used in lamb finishing rations, resulting in a valuable ingredient as replacement for conventional feeds, which could reduce feeding costs because of the lower cost of the olive by-product. Use of olive by-products as animal feed may become economically feasible for producers where the olive oil industries play an important economic role.