Straw price increases due to biofuel demand have created a perceived need within the agricultural industry to investigate and develop alternative bedding materials for housing ruminant livestock. This thesis addresses the suitability of woodchip, as such an alternative, indoor bedding material for livestock, focusing particularly on management of the soiled bedding, its nutrient composition, its use as an agronomic resource and its economic viability within the Welsh farming sector. In all studies, straw was used as the benchmark to which the woodchip treatments were compared. Many studies have investigated the use of woodchip in out-winter pads (OWP), but the material’s indoor performance and in particular, its potential for re-use, is not well documented. Two independent housing trials, both including sheep and cattle, were conducted. The first trial (ADAS) assessed the effect of different initial woodchip moisture contents on the performance of the bedding material and its subsequent composting. The second trial (IGER) evaluated the effects of hay and silage diets on woodchip’s bedding and composting performance. The ADAS trial showed that woodchip’s absorbency capacity and physical shape were critical in determining its bedding and composting success. In comparison to differences determined by bedding materials and livestock characteristics, the IGER trial suggested that dietary inputs had little influence on the woodchip’s bedding and composting performance. Overall, the results indicate that composting of spent woodchip bedding was less effective than that of straw bedding, due to the lack of available N which limited microbial activity. The limited breakdown of the woodchips during composting, however, does potentially allow the re-use of the bedding materials for further housing cycles. Barley sown growth trials, amended with composted bedding materials showed that woodchip composts yielded reduced biomass in comparison to conventional NPK based fertilisers and straw bedding compost. When the coarse woody fraction of the compost was removed (>8 mm in diameter), leaving just the fine (< 8mm) nutrient-enriched fraction, plant growth performance was slightly enhanced at application rates equivalent to 100 t ha-1. Estimates of N loss from woodchip treatments were high during housing, but limited during composting due to a generic lack of available nutrients, compared to straw. Using economic modelling, a cost/benefit analysis of woodchip bedding versus straw showed that woodchip is more cost efficient than straw on the condition it is re-used. In summary, the thesis concludes that woodchip is a potentially viable alternative to straw bedding for Welsh farmers, on condition of specific management practices. Future work is required to identify and mitigate N losses during the woodchip bedding phase.