Feedlots are yarded areas where cattle and sheep, after having been raised on pasture, are held in close confinement for a period before they are slaughtered. During this period, food and water for the animals are supplied mechanically or by hand. Feedlots are used to ensure that cattle and sheep reach a specific weight before slaughter and to provide consistent meat quality.

There are almost 700 cattle feedlots in Australia, with the largest regional concentrations in mixed farming areas of New South Wales and southern Queensland. Most cattle feedlotters are accredited under the National Feedlot Accreditation Scheme and are expected to adhere to the Model Code of Practice for the Welfare of Animals: Cattle. Accredited feedlots also use the National Guidelines for Beef Cattle Feedlots in Australia as a guide for best practice.

A framework for the operation and management of sheep feedlots is available through the National Procedures and Guidelines for Intensive Sheep and Lamb Feeding Systems.

There are, potentially, some serious welfare problems associated with keeping animals in this type of intensive system. These include the restriction on the ability of animals to move around, lack of adequate shelter from the extremes of weather (especially heat), and the problems of manure buildup and wet manure. Other potential problems are associated with handling of the animals, mixing of unfamiliar animals, dust levels and feed management. The RSPCA is opposed to the confinement of animals in ways that unreasonably restrict their movements and normal behavioural patterns, and that result in unacceptable risks to their health and wellbeing.

The RSPCA believes that the welfare of animals in feedlots is, in part, determined by the design and management of the facility. Feedlots should only be managed by trained and competent staff, and the facilities must include proper shelter from the weather (including shade to reduce heat stress), good drainage (to avoid the problems of wet manure), a suitable hard standing area, and a constant supply of suitable food and water that all animals can access. Management of the feedlot should follow the advice of a veterinarian experienced with feedlot animals. Sick animals should be quickly identified and treated.

The welfare of animals in feedlots can be enhanced by using low-stress stock-handling methods, by providing enrichment (e.g. through physical exercise), and by providing straw in the diet (to allow animals to chew their cud).