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Context: Coping with high levels of cold stress should be beneficial to survival of lambs, given the high mortality rate associated with severe winter storms. The Elsenburg Merino selection experiment involved divergent selection for reproduction. Phenotypic results comparing the positively selected H-Lines and negatively selected L-Lines suggested that cold-stress adaption could have contributed to the favourable genetic trends for survival of H-Line lambs. However, observing the genetic merit of better adapted animals depends on the presence of cold stress at the time of recording. A genotype by environment component (G × E) could, thus, be important when assessing survival/mortality phenotypes. Aim: This study proposed the genetic analysis of this possible G × E component and compared the H- and L-Lines in this regard. Methods: The sire model allowed the use of progeny phenotypes for neonatal mortality recorded during different levels of cold stress, and the possible G × E could be investigated through the reaction-norm approach. Genetic parameters were evaluated as random regression components by implementing a Gibbs sampling approach. A data set of 5723 individual lamb records was analysed as the progeny of 213 sires. Results: A modelled G × E component played an important role in mortality outcomes, with the mean estimate (and 95% confidence interval) for the slope ( σ s b 2 = 0.113 [ 0.0019 – 0.28 ] AN22464_IE1.gif) only marginally smaller than the corresponding estimate for the intercept ( σ s a 2 = 0.124 [ 0.003 – 0.26 ] AN22464_IE2.gif). The reaction-norm model showed a higher heritability (h 2 ± posterior standard deviation) for mortality at 3 days of age during high cold-stress (0.22 ± 0.16 at ~1100 KJm−2h−1) than during mild (0.13 ± 0.10 at ~960 KJm−2h−1) conditions, suggesting a greater ability to discriminate between sires at increasing stress levels. Conclusions: Failure to account for this G × E component putatively contributes to the low h 2 commonly reported for survival traits. The higher h 2 at increased levels of cold stress could have played an important part in the higher survival of the H-Line progeny, who were better at coping with cold, wet and windy conditions. Implications: Larger studies representing a wider environmental trajectory are recommended. This should be very feasible since cold stress can be derived from commonly available weather-station data. Animals better adapted to cope with cold stress conditions should have higher survival rates, but the merit of these animals would not be visible under mild conditions. Accounting for the level of cold stress in the earliest days after birth allows for new ways to evaluate the genetic merit of survival or mortality traits. Cold-stress adaption is likely to have been an important part of the very favourable survival rate of the Elsenburg Merino H-Line. [ABSTRACT FROM AUTHOR]