Carotenoid pigments are good biomarkers of grass-feeding in sheep. However, as grazing lambs may be concentrate-finished, we investigated the effect of concentrate finishing after grazing on the carotenoid concentration of fat in sheep, and its significance for discriminating lamb production systems. In experiment 1 with 32 lambs, four feeding treatments were compared: G = grazing, C = feeding a concentrate-based diet, GSC = short concentrate-finishing period after grazing, and GLC = long concentrate-finishing period after grazing. The concentrate supply was regulated to have similar average daily gain for all treatments. In experiment 2, 42 ewes were given a low carotenoid diet after pasture feeding, for 0, 8, 22, 42, 84 or 126 days. The feeding level was adjusted to maintain body weight and body condition score. The nature and concentration of carotenoids was analysed by HPLC on diets and lambs’ perirenal fat. The reflectance spectrum of perirenal fat was measured at slaughter. Lutein was the only carotenoid in lamb fat. In experiment 1, the intensity of light absorption by lutein was linearly related with its concentration in the fat (P < 0·001) and was negatively correlated with the duration of the finishing period. The design of experiment 2 avoided the confounding effect of fat gain during the finishing period and examined the effect of the duration of this period by itself. There was no effect of stall-feeding duration on the intensity of light absorption by carotenoids in the fat in experiment 2, demonstrating that the effect of stall-feeding duration in fattening lambs was mediated via a dilution of existing fat with whiter fat rather than through pigments coming out of the fat. The concentration of lutein and the intensity of its light absorption in the fat decreased with lamb body-weight gain during the finishing period (P < 0·01 and P < 0·05 respectively) and increased with plasma carotenoid content at the end of the grazing period (P < 0·001). Because of the inter-individual variability in carotenoid absorption, the use of the reflectance spectrum of the fat alone may cause some concentrate finished grazing lambs to be classified as C lambs shortly after the beginning of the stall-feeding period, whereas others may be considered as G lambs for a long period of time. However, the combined use of plasma carotenoid content at slaughter together with the reflectance spectrum of the fat improves reliability in the discrimination of grass-fed, concentrate-fed and concentrate-finished grazing lambs, by taking advantage of the differences in the rate of reduction in carotenoid concentration in blood and fat.