Using by-product feeds can be a means of reducing feed costs, however, challenges with the pelleting process may affect pellet quality. The effect of pellet size and durability of a by-product based pellet was evaluated in 8 crossbred ruminally cannulated heifers. The experiment was conducted as a replicated 4 × 4 Latin square design with a 2 × 2 factorial treatment arrangement. Pellets were prepared using a 3.96 mm (SP) or 12 mm (LP) die and contained Nutraflex Plus (3 kg/T) and Ameri-Bond 2X (5 kg/T) as binding agents (B) or no binding agent (NB). Heifers were fed a partial mixed ration (81.8% grass hay and 18.2% oat hull, DM basis) ad libitum and pellet was offered separately at a rate of 0.09% of BW. Heifers were provided 15 d for adaptation followed by 3 d for total fecal and urine collection, rumen fluid sampling and continuous rumen pH measurement using indwelling pH probes. Statistics were conducted using PROC MIXED in SAS with the fixed effect of pellet size, binder inclusion, and the interaction. Tukey’s adjusted post hoc mean separation test was used to compare treatment means where significance was declared at P ≤ 0.05. Heifers fed pellet with binder had increased (P ≤ 0.05) ADG and G:F, did not differ (P ≥ 0.33) in DM intake. The molar proportion of acetate was greater (interaction, P = 0.03) in heifers fed large pellet with binder (66.0%) compared with small pellet with binder (63.9%) whereas the large and small pellets without binder were intermediate (64.6 and 63.9%, respectively). Propionate was greater (interaction, P = 0.05) in heifers fed large pellet (17.7%) with no binder than with binder (15.6%) and was intermediate for heifers fed the small pellet with and without binder (17.6 and 17.2%, respectively). Heifers fed binder had butyrate concentrations that were 0.68% greater (P = 0.05) than without binder. Total-tract digestibility was not affected. The results of this experiment indicate that overall digestibility of a by-product based range pellet was not influenced by size or binder; however, pellet size and use of a binder may influence rumen fermentation, ADG, and feed conversion.