A review of past literature revealed inconsistencies in recommended feed particle size for optimal growth and productive performance of rabbits. Changing diet formulation and subsequent processing conditions may improve pellet texture and potentially affect rabbit performance. In the current study, two isoenergetic and isonitrogenous pelleted diets were formulated, which varied in the particle size of the concentrates (2 and 8 mm, respectively). The objective was to evaluate the effect of different particle sizes of compound diets on performance, nutrient utilisation, gut morphology, and carcass characteristics of fattening Italian White breed rabbits. The finely ground diet led to a significant improvement in feed efficiency and apparent digestibility of crude protein, ether extract, crude fibre and NDF, without any negative effect on gut morphology. Furthermore, a smaller particle size of concentrates in pelleted diets improved carcass traits. Meat colour parameters showed significant differences in longissimus lumborum and biceps femoris due to dietary treatments, but in both muscles pH values 1 h and 24 h after slaughter remained unchanged. It is concluded that a finely ground pelleted diet can be used to improve growth performance of rabbits without affecting carcass parameters.