Cold‐formed steel sections are used to form various components of low‐and medium‐rise buildings. Such sections are commonly constructed with sheathing board, providing thermal and acoustic separation between interior partitions. In contemporary projects, these sheathing boards have been used to provide bracing and increasing lateral stiffness. The strength and stiffness of sheathing‐braced structural assemblies is governed by connections between framing elements and sheathing components. This paper describes an experimental investigation of stability and strength of sheathed cold‐formed steel lipped sigma wall studs under compression loading. A total of 35 experimental tests conducted covering various parameters including, sheathing plasterboard thickness, stud and track thickness, plasterboard configuration and density. Sheathing density and thickness are found to be significant in impacting the compression strength of the sheathed cold‐formed steel lipped sigma studs. A clear pattern was noted between plasterboard material and thickness on the stability and strength of the sheathed stud. It is found that higher density boards provided the greatest restraint against buckling, as did increased thicknesses. Isolating direct loading of the sheathing, and Composite action between the stud and sheathing are shown to be significant in determining the strength and controlling limit state of the stud.