Polypeptide variation encoded by the ovine transmembrane protein 154 gene (TMEM154) is associated with susceptibility to ovine lentivirus, the causative agent of Ovine Progressive Pneumonia (OPP) and Visna/Maedi. Our aim was to compare the four most prevalent TMEM154 haplotypes on the incidence of infection and ewe productivity during natural multiyear virus exposure. Prospective cohort studies were designed to test gene action and estimate effects of TMEM154 haplotypes encoding distinctive variant residues: K35 (“1”), I70 (“2”), ancestral (“3”), and A4del/M44 (“4”). Exposure consisted of co-mingling infected ewes at a rate greater than 30% with serological status evaluated every four months. For ewes with one or two copies of the highly susceptible haplotypes “2” and ”3”, the infection prevalence steadily increased to nearly 100% at 55 months. Haplotypes “2” and “3” were equally susceptible and dominant to haplotype “1”. A difference was not detected (p < 0.53) in the magnitude of effect with haplotype combinations of “1” and ”4”. The ewe infection prevalence with “1,1”; “1,4”; and “4,4” was 10% to 40% at 55 months. The latter suggested that two copies of the K35 amino acid substitution (“1”) were as effective as a homozygous TMEM154 “knockout” with the frame-shift deletion mutation (“4”) in reducing infection susceptibility. When considering ewe reproductive performance, a difference was not detected when comparing haplotypes “2”, and “3” to each other, or “1” and “4” to each other. Our study indicated that ewes with two copies of the severely truncated versions of TMEM154 (“4,4”) had normal lamb productivity. Without complete understanding of the natural function of TMEM154 our recommendations to producers interested in using TMEM154 selection to reduce their flock’s genetic predisposition to OPP are encouraged to increase the frequency of TMEM154 haplotype K35 (“1”) since it encodes a full-length protein with minimal difference to the ancestral polypeptide.