By the end of its seven-year term in 2007-08, the Australian Sheep Industry CRC (Sheep CRC) will have received total funds of about $90 million, that comprises Commonwealth and industry funding of $30 million, and in-kind contributions valued at $60 million. This level of public and private funding emphasises the need for the Sheep CRC to demonstrate that its research programs will generate sound economic returns to all stakeholders. This paper reports an evaluation of the potential economic value of the achievements of the Sheep CRC at the midpoint of its term of operations at which it has some completed research and a large volume of research in progress. The main question that has been addressed in this evaluation concerns the nature and likely magnitude of the potential benefits relative to the costs of their realisation. The economic methods and other procedures that were used to answer this question, the evaluation scenarios and the results obtained are described. Based on the defined with- and without-Sheep CRC evaluation scenarios, the ‘bottom-line’ result was that the Sheep CRC’s scientific research programs have the potential to deliver a total incremental benefit with a 20-year net present value (NPV) of $191.3 million, and a total benefit-cost ratio (BCR) of 8.1:1 (both at a 5% real rate of discount), indicating that the Sheep CRC’s total research investment over all programs has the potential to return about $8 for every $1 of research investment funds.