Scientists will attempt to breed bare-bum sheep in a $2-million research program that could provide an alternative to a painful animal husbandry practice.

Australia's wool industry has been under pressure from an international animal rights campaign to phase out mulesing – where farmers cut skin folds from sheep's backsides to prevent the animals becoming fly blown.

The research would determine the degree of flystrike resistance that could be bred into sheep in a five-year program focusing on test flocks in two states.

Research and development body Australian Wool Innovation (AWI), which was funding the project, said scientists aimed to select sheep which had naturally bare areas around the breech.

"You go out to a normal flock of unmulesed sheep and there'll be some variation in the breech, some will be more wrinkly than others, some will have a bigger naturally bare area," AWI wool production manager Ian Rogan said.