Cutaneous myiasis (fly strike), caused by Lucilia cuprina, is a major ectoparasitic infection of sheep. Previous research has identified contributions of body conformation, wool characteristics and resistance to bacterial dermatoses to resistance to fly strike. This paper investigates whether genetic variation occurs amongst sheep in growth of larvae on skin. Mixed sex Merino sheep in 27 half-sibling groups were challenged with freshly hatched Lucilia cuprina larvae, and survival and growth of larvae were measured after 50 h. Growth but not survival of larvae had moderate heritability (0.29 ± 0.22), comparable to that seen for resistance to nematode parasites in sheep. Phenotypic correlations between resistance to larval growth and wool traits, skin wheal response to intradermal injection of larval excretory secretory products and resistance to internal parasites were negligible; however, there was a significant negative phenotypic correlation with fleece rot score after exposure of sheep to simulated rain at a time independent to that of measurement of larval growth. Larval growth was negatively correlated with peripheral blood eosinophil numbers measured either before or after larval challenge. In addition, larval growth in vitro on serum collected from challenged sheep was moderately associated with larval growth in vivo. A search for quantitative trait loci (QTL) for larval survival and growth was conducted in data from 94 half-sibling progeny of a Merino × Romney sire backcrossed to Merino ewes. Potential QTL for larval growth were identified on chromosome 11 and for larval survival on chromosome 18, although phenotyping greater numbers of sheep and a higher marker density on these chromosomes is necessary to confirm the result. We conclude that this study has identified a novel level of resistance of Merino sheep to growth of L. cuprina larvae that may be mediated in part through actions of anti-larval factors in serum and eosinophils. Further studies are required to establish the impact of growth retardation on the severity of systemic responses of sheep to fly strike and on the biology of adult flies.