Fleece rot develops following prolonged wetting of sheep when bacterial proliferation in wool and on skin induces exudation of serum proteins onto the skin surface and causes damage to wool follicles and fibres. These processes create an attractive environment for blowflies to lay eggs, leading to body strike. Current reliance on insecticides for prevention and treatment of fly strike is being increasingly challenged by development of insecticide resistance. This review examines the large body of past research on the bacterial causes of fleece rot, the genetics of sheep susceptibility and resistance, the characteristics of the resulting immune defence reactions, and attempts to control fleece rot by vaccination. The high dependence on weather conditions for expression of fleece rot hampers studies on the disease. Normal skin and wool are populated by a dynamic microbial community. During adverse environmental conditions, natural resistance to fleece rot associated with physical characteristics of wool and skin can be overwhelmed and a complex mix of bacteria flourishes. Prolonged hydration alone, and in combination with bacterial exoproducts, induces dermatitis and exudation of immunoglobulins and other serum proteins onto the skin surface. Pathogens do not usually penetrate the epidermis. Nonetheless, during prolonged skin hydration, sheep can become sensitised to fleece rot pathogens and produce antibodies. Antibody titres rise late within a typical (3 week) case of fleece rot. High naturally acquired antibody titres may contribute to resistance to fleece rot. In contrast to some evidence for a protective role of antibody, there is little evidence for innate or adaptive cellular immune responses contributing to protection against fleece rot pathogens. Previous attempts to develop vaccines have met with mixed success. Nonetheless, there remain prospects for development of a new vaccine to control fleece rot. Further knowledge on the microbial ecology of normal and wet skin would assist this endeavour and may help identify other control strategies.