This study investigated the hypothesis that feeding broilers over-processed meat and bone meal (MBM) would impair gut health in the absence of phytase and in turn, affect inositol phosphate (inositol x-phosphate, IPx: IP3, IP4, IP5 and IP6) ester hydrolysis, intestinal permeability, hematology, jejunal gene expression and intestinal morphology during necrotic enteritis (NE). Ross 308 male broilers (
n
= 768) were assigned to one of 8 dietary treatments in a 2 × 2 × 2 factorial arrangement, with 6 replicate pens per diet and 16 birds per pen in a completely randomized design. Factors were: NE challenge (no or yes), phytase level (500 or 5,000 FTU/kg) and MBM processing (as-received or over-processed). For the NE challenge, half of the birds were challenged with field strains of
Eimeria
spp. on d 9 and 10
8
CFU/mL of
Clostridium perfringens
strain EHE-NE18 on d 14 and 15. A 3-way challenge, phytase and MBM processing interaction was detected for IP5 (
P <
0.05) and IP6 (
P <
0.05) levels in the ileum. Birds fed low phytase had increased IP5 and IP6 in unchallenged birds only when diets contained over-processed MBM. Challenge with NE increased intestinal permeability as measured by serum fluorescein isothiocyanate dextran (FITC-d;
P <
0.001), increased white blood cells (WBC;
P <
0.001), decreased mean corpuscular volume (MCV;
P <
0.001) and mean corpuscular hemoglobin (MCH;
P <
0.05), and decreased crypt-to-villi ratio (
P <
0.05). The over-processed MBM reduced the villi-to-crypt ratio (
P <
0.05). A 3-way challenge × phytase × MBM processing interaction was detected for mucin 2 (
MUC-2
) expression (
P <
0.05) where only in unchallenged birds fed over-processed MBM did high phytase reduce
MUC-2
expression. A lower expression of aminopeptidase N (
APN
;
P <
0.001) and vitamin D receptor (
VDR
;
P <
0.001) were recorded in NE challenged birds. In conclusion, NE has a negative impact on the gut and hematology of broilers, but its effect on phytate hydrolysis is minimal.