Genetic theory and data suggest that sea ranching of anadromous salmonids (Oncorhynchus spp. and Salmo spp.) results in domestication (increased fitness in the hatchery program) accompanied by a loss of fitness for natural production. We tested for genetic differences in growth, survival, and downstream migration of hatchery and wild steelhead (O. mykiss) reared together in a hatchery. We found little or no difference in survival during hatchery rearing but substantial differences in growth and subsequent downstream migration. Intense natural selection after release from the hatchery favored fish that had performed well (e.g. grew fast) in the hatchery. This selection in the natural environment genetically changes (domesticates) the population because at least some of the performance traits are heritable. Domestication should improve the economic efficiency for producing adult hatchery fish but compromise conservation of wild populations when hatchery fish interbreed with wild fish.