Mycoplasma ovis (formerly Eperythrozoon ovis) is a haemotropic parasitic bacterium found within erythrocytes and distributed widely in global sheep and goat production regions. M. ovis is transmitted by biting flies and by contaminated instruments, causing morbidity and mortalities from anaemia, usually within 6 weeks following blood-exposure procedures, particularly vaccination, castration, ear tagging, mulesing, and occasionally crutching and shearing. Affected animals develop haemolytic anaemia and may have jaundice, causing abattoir condemnations. The typical history, clinical and pathological findings, display of M. ovis in blood smears and/or by PCR is diagnostic, although immune responses deplete M. ovis from smears; hence, in-contact healthy animals should be examined. Differential diagnoses include haemonchosis, fasciolosis, malnutrition (copper or vitamin B12 deficiency), and plant toxicities. M. ovis parasitaemia may persist, with recrudescence following stressful events, although most older sheep remain immune. Human infections have been reported. Inadequate socioeconomic data present difficulties in assessing the impact of M. ovis on production and as antimicrobial therapy is ineffective, its control requires management practices that minimize the impact of invasive procedures in periods when risks of M. ovis transmission are more likely. Although considered an emerging pathogen, recent improvements in welfare attitudes and husbandry practices on Australian sheep farms may potentially limit the transmission of M. ovis.