The capture, handling and release of invertebrates such as lobsters during commercial fishing operations can lead to physiological changes such as reduced growth and impaired reproduction. In particular, dam-age to appendages can reduce the exploitable biomass available to fishers as moulting lobsters expend energy resources regrowing limbs at the expense of increasing in size. To assess the effect of injuries on the growth of male and female lobsters smaller than the legal minimum size (undersize), a Bayesian hierarchical approach was taken to fit the parameters of the von Bertalanffy growth equation to mark-recapture observer data from southern stock assessment areas (SSAAs) of the Tasmanian southern rock lobster (TSRL) fishery in Australia. While the effect of handling damage on the growth of undersize females could not be distinguished from zero because of small growth increments, the impact on males was marked, with damage to antennae or legs estimated to have a similar proportional impact on growth of 7% (0–16%, 95% CI) and 7% (0–14%, 95% CI) respectively. Damage to both antennae and legs had a greater estimated proportional impact on growth of 40% (24–57%, 95% CI). Despite the substantial reductions in predicted growth caused by the loss of antennae and/or legs, fewer than 6% of under size male lobsters had these types of injuries. With an estimated 4.22 ± 0.4 (mean ± 95% CI) million lobsters discarded annually between 2001 and 2010 from SSAAs, annual lost productivity and revenue from slower growth was predicted to be 1.6 tonnes and AUD $72,905 respectively in the TSRL fishery. The overall impact of dam-age on male lobsters was less than 1% of the total allowable catch and revenue for the TSRL fishery in 2010. Mortality among damaged lobsters was estimated at 3.9% from SSAAs for a total productivity loss of 22.1 tonnes in the TSRL fishery. These results highlight the effectiveness of the fishing method, sorting procedures, as well as management measures (escape gaps) and the biology of the species in reducing excessive amounts of handling damage in the TSRL fishery.