Abstract: In this study, two levels of Metabolizable Energy (ME) (2.3 and 2.5 Mcal kg-1 DM) and three levels of Crude Protein (CP) (12, 14 and 16%) and their interactions were studied to identify the optimum levels of dietary energy and protein for lambs of the Taleshi breed. The growth performance variables measured included Average Daily Gain (ADG), final weight, Daily Dry Matter Intake (DDMI, kg day-1) and Feed Conversion Ratio (FCR) whilst other commercially important factors were assessed during specific periods. The urea dilution method was used for predicting the body composition of live lambs. At the end of the experiment, all animals were slaughtered, the carcasses were cut and the chemical composition of the area around the 9th, 10th and 11th rib was measured. The study comprised a completely randomized design with a 2x3 factorial arrangement with four replications per diet. The results showed that the energy and protein levels had a significant effect (p<0.05) on growth. The diet with 2.5 Mcal ME kg-1 and 14% CP was associated with the best final weight, ADG, FCR, feed cost kg-1 gain, un-variable profit kg-1 live weight, un-variable profit/total gain, carcass weight, shoulder weight, thigh weight and ribeye area (REA). A high dietary energy level helps to produce more ME and fermentable products for paunch microorganisms resulting in an increase in the synthesis of microbial protein and therefore the amount of protein available to the animal. Increasing the dietary protein level causes a change in the process of fermentation in the paunch whilst increasing fatty acid production and the ratio of propionate to fatty acids. These changes in the paunch improve the lamb`s energy balance allowing more nitrogen to be stored and increasing the body weight.