Virtual fencing technology uses a neckband-mounted device to deliver an audio cue when an animal nears a virtual boundary that is set via a global positioning system, followed by an electrical stimulus if it crosses the boundary. The flexibility offered by this technology could revolutionize grazing management on dairy farms, but its application and effects on lactating dairy cattle have not been assessed. This experiment reports on the effects of an electric or a virtual front-fence on dairy cow behavior and welfare. Two temporally separated treatments were applied to a herd of 30 multiparous cows. Cows were provided an estimated 14 to 15 kg of dry matter/cow of fresh pasture in a new paddock every 24 h. From d 1 to 10 cows were grazed using a conventional electric front-fence (control treatment) and from d 14 to 23 they were grazed using a virtual front-fence (eShepherd, Agersens Pty Ltd.). Cows were trained to the technology from d 11 to 13. The milk production and live weight of individual cows were recorded daily. Cortisol concentrations were obtained from milk samples collected from individual cows on 3 d during each of the control and the virtual fence grazing periods, plus the first day of training. From d 6 of the experiment, 6 focal cows were fitted with a RumiWatch (Itin + Hoch GmbH) noseband sensor to monitor grazing and ruminating time, and 8 focal cows were fitted with an IceTag (IceRobotics Ltd.) sensors to monitor activity. Milk production, live weight, and the time cows spent standing and lying did not differ between the electric and virtual fence periods. Milk cortisol concentrations, activity, and the times spent ruminating and grazing were comparable between the electric and early virtual fence periods (i.e., d 1-3 with a virtual fence). However, at d 4 to 6 with a virtual fence, activity (steps taken and motion index) and time spent grazing were lower, and time spent ruminating was greater, compared with an electric fence. Further, least significant difference tests suggest milk cortisol conc...