Background The effect of bariatric surgery on postoperative thyroid function remains incompletely understood. In this study, we aimed to evaluate the changes in thyroid functions after gastric sleeve operation for morbidly obese Egyptian patients. Methods This was a prospective study that recruited 128 patients who underwent sleeve gastrectomy through the period from December 2016 to April 2020. We measured thyroid-stimulating hormone (TSH), free thyroxin (FT4), and free triiodothyronine. Subclinical hypothyroidism was defined by a TSH level [ 4.5 mIU/L but a normal FT4 level. All patients were followed for 12 months after the procedure. Results Preoperatively, 30 (23.4%) patients had subclinical hypothyroidism. The prevalence of subclinical hypothyroidism decreased significantly to reach 7.8% at the end of follow-up (p \ 0.001). None of the patients developed de novo hypothyroidism at the end of follow-up. Patients with subclinical hypothyroidism were more likely to be females (p = 0.037) and had significantly higher waist circumference (p \ 0.001), DBP (p = 0.02), serum cholesterol (p \ 0.001), and serum triglyceride (p \ 0.001). However, patients with subclinical hypothyroidism at the end of follow-up had significantly higher BMI at the end of the sixth month (p = 0.048). Similarly, patients with subclinical hypothyroidism at the end of follow-up had significantly higher serum cholesterol (p = 0.002), LDL, (p = 0.038), and serum triglyceride (p \ 0.001) at the end of the sixth months of follow-up. A similar trend was noted at the end of the 12th month. The preoperative value of serum TSH correlated significantly with serum cholesterol and triglyceride levels. Conclusion The positive effect of the LSG procedure on the hypothyroid bariatric population, including enhanced thyroid function, was demonstrated.