Teff (Eragrostis tef) is a drought-tolerant, multi-harvest, high-quality summer forage crop. We conducted a study aiming at assessing the effect of replacing wheat hay with teff hay in diets on the feed intake, digestibility, and lactational performance of dairy cows. Thirty-four multiparous (≥3rd parity) Israeli Holstein Friesian dairy cows averaging (± SD) 182 days in milk ± 8 days in milk, 45 kg/d ± 4.8 kg/d of milk yield, and a body weight of 647.1 kg ± 51 kg at the beginning of the study were recruited to a 6-week feeding trial. Cows were randomly divided into two balanced groups based on parity, days in milk, and milk yield. Cows were subjected to two low-roughage dietary treatments (~30% roughage): a control wheat hay-based diet and a teff hay-based diet. Production performances, dry matter intake, and nutrient digestibility were measured. Milk samples were analyzed for their composition and fatty acids profile. Blood samples were used to measure metabolite concentrations. The statistical model included fixed effects of dietary treatments, time, and random effects of cows nested in treatment. Production data and feed intake were analyzed as repeated measures using a covariance structure. Dietary treatments did not affect dry matter intake (26 kg/d). However, the teff-fed cows demonstrated higher crude protein digestibility than control cows (61.9% vs. 59.2%). Dietary teff inclusion increased milk yield by 1.5 kg/d. Polyunsaturated fatty acids and omega-3 fatty acids profiles in milk were greater in the teff cows than in the control cows (4.77 g/100 g vs. 4.36 g/100 g and 3.71 g/100 g vs. 3.43 g/100 g, respectively). Non-esterified fatty acids, beta-hydroxybutyrate, and blood urea nitrogen concentrations in circulation were higher in the control group than in the teff group. The acetic-to-propionic-acid ratio in the rumen fluid was higher in control cows than in teff cows (2.90 vs. 2.43). However, the ruminal ammonia-N concentration was higher in the teff cows than in the control cows (18.5 mg/dL vs. 15.8 mg/dL). In conclusion, teff hay inclusion in the rations of high-producing dairy cows increased milk yield, which could be attributed to improved crude protein digestibility and energy partition to production.