BACKGROUND: Enteric fermentation by farmed ruminant animals is a major source of methane and constitutes the second largest anthropogenic contributor to global warming. Reducing methane emissions from ruminants is needed to ensure sustainable animal production in the future. Methane yield varies naturally in sheep and is a heritable trait that can be used to select animals that yield less methane per unit of feed eaten. We previously demonstrated elevated expression of hydrogenotrophic methanogenesis pathway genes of methanogenic archaea in the rumens of high methane yield (HMY) sheep compared to their low methane yield (LMY) counterparts. Methane production in the rumen is strongly connected to microbial hydrogen production through fermentation processes. In this study, we investigate the contribution that rumen bacteria make to methane yield phenotypes in sheep. RESULTS: Using deep sequence metagenome and metatranscriptome datasets in combination with 16S rRNA gene amplicon sequencing from HMY and LMY sheep, we show enrichment of lactate-producing Sharpea spp. in LMY sheep bacterial communities. Increased gene and transcript abundances for sugar import and utilisation and production of lactate, propionate and butyrate were also observed in LMY animals. Sharpea azabuensis and Megasphaera spp. act as important drivers of lactate production and utilisation according to phylogenetic analysis and read mappings. CONCLUSIONS: Our findings show that the rumen microbiome in LMY animals supports a rapid heterofermentative growth, leading to lactate production. We postulate that lactate is subsequently metabolised mainly to butyrate in LMY animals, producing 2 mol of hydrogen and 0.5 mol of methane per mol hexose, which represents 24 % less than the 0.66 mol of methane formed from the 2.66 mol of hydrogen produced if hexose fermentation was directly to acetate and butyrate. These findings are consistent with the theory that a smaller rumen size with a higher turnover rate, where rapid heterofermentative growth would be an advantage, results in lower hydrogen production and lower methane formation. Together with previous methanogen gene expression data, this builds a strong concept of how animal traits and microbial communities shape the methane phenotype in sheep.