Often the only way to ensure profitability of Lacaune dairy sheep is intensive management, which requires appropriate dry-period treatment to ensure animal productivity and health. The present study aimed to investigate the effects of intramammary antibiotic dry therapy on the performance and health of Lacaune sheep under intensive management. We recorded data for 5981 complete lactation periods that followed a dry period. A total of 2402 lactation periods were preceded by a dry period involving intramammary administration of 300 mg of cephapirin benzathine (antibiotic group) and 3579 lactation periods were preceded by dry periods with no treatment (control group). The following on-farm yield data were collected for individual lactation periods: length of the subsequent lactation period; total milk yield per lactation period; daily milk yield and length of the subsequent dry period. Data on confounding factors that might affect productivity were also recorded, including the individual ewe, number of lactation periods and length of the previous dry period. Milk quality was assessed using data on somatic cell count (SCC) and content of protein and fat taken from the Spanish National Official Milk Yield Recording System. Antibiotic dry therapy significantly improved total yield per lactation period, which was 429±151·1 l in the antibiotic group and 412±165·5 l in the control group, as well as the daily milk yield, which was 1986±497·0 and 1851±543·2 ml/d, respectively (both P<0·0001). The initial dry period was significantly longer in the antibiotic group than in the control group, and dry period length correlated inversely with yield variables such us total yield per lactation period (r=−0·055; P<0·0001) and yield per day in milk (r=−0·039; P<0·0001). As a result, milk yield records systematically underestimated the positive effects of antibiotic dry therapy. Antibiotic dry therapy also significantly improved milk quality. Milk from the antibiotic group showed 50% lower SCC (573±1326 vs. 1022±2126 cells/ml; P<0·0001) and slightly higher content in fat (7·33±0·91 vs. 7·15±0·87%) and protein (5·63±0·44 vs. 5·44±0·4%). The results of this study suggest that cephalosporin dry therapy of Lacaune dairy sheep increases milk production and improves milk quality during subsequent lactation periods.