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Background Imputation to whole-genome sequence is now possible in large sheep populations. It is therefore of interest to use this data in genome-wide association studies (GWAS) to investigate putative causal variants and genes that underpin economically important traits. Merino wool is globally sought after for luxury fabrics, but some key wool quality attributes are unfavourably correlated with the characteristic skin wrinkle of Merinos. In turn, skin wrinkle is strongly linked to susceptibility to “fly strike” (Cutaneous myiasis), which is a major welfare issue. Here, we use whole-genome sequence data in a multi-trait GWAS to identify pleiotropic putative causal variants and genes associated with changes in key wool traits and skin wrinkle. Results A stepwise conditional multi-trait GWAS (CM-GWAS) identified putative causal variants and related genes from 178 independent quantitative trait loci (QTL) of 16 wool and skin wrinkle traits, measured on up to 7218 Merino sheep with 31 million imputed whole-genome sequence (WGS) genotypes. Novel candidate gene findings included the MAT1A gene that encodes an enzyme involved in the sulphur metabolism pathway critical to production of wool proteins, and the ESRP1 gene. We also discovered a significant wrinkle variant upstream of the HAS2 gene, which in dogs is associated with the exaggerated skin folds in the Shar-Pei breed. Conclusions The wool and skin wrinkle traits studied here appear to be highly polygenic with many putative candidate variants showing considerable pleiotropy. Our CM-GWAS identified many highly plausible candidate genes for wool traits as well as breech wrinkle and breech area wool cover.