This study investigates the effects of enzymatic treatment with microbial transglutaminase (m-TGase) on the physical and mechanical properties of the depigmented wool yarns. Coarse pigmented wool yarns were treated with iron (II) followed by depigmentation with both oxidative and oxidative-reductive chemicals. The depigmented wool yarns were then treated with m-TGase to reduce the negative effects of the harsh chemicals. Diverse features of the wool yarns, including: tensile strength, elongation, color, diameter, moisture content, alkali solubility, and weight reduction, were measured before and after bleaching and enzymatic treatments. The treatment with the oxidative and reductive agents led to reduced tensile strength and elongation, and increased lightness, alkali solubility, and moisture content of the yarns. In contrast, the enzymatic treatment by m-TGases cross-linked the proteins of wool fibers via reaction between glutamine and lysine isodipeptide remediated the wool yarns. This improved the tensile strength and elongation and decreased the alkali solubility and moisture content. Fourier transform infrared spectroscopy (FTIR) was used to follow the chemical changes in wool fibres during depigmentation and enzymatic treatments.