The low efficiency of flow cytometric sex-sorting of stallion sperm has been attributed to the use of an opaque skim milk-based diluent during Hoechst 33342 (H33342) staining. Three experiments were conducted to formulate an optically clear stallion semen diluent for use during H33342 staining, and to determine whether a clear diluent improved resolution during sorting. For Experiment 1, sperm were incubated at 34 °C in each of five diluents containing either no protein, skim milk, 0.25% Cohn's Fraction V BSA, 0.5% BSA, or 1% BSA, following an 18 h storage (15 °C) period, or shortly after collection. Sperm incubated in both skim milk and 1% BSA-supplemented diluents had equivalent total (47 and 49.5%, respectively) and progressive (4.73 and 5.67%, respectively) sperm motilities after 45 min, and comparable acrosome integrity (65.9 and 67.9%, respectively). For Experiment 2, the protein source was optimised by comparing the characteristics of sperm stored and incubated in five diluents supplemented with skim milk, BSA, fatty acid and endotoxin free BSA (I-BSA), KnockOut™ Serum Replacement, and β-lactoglobulin, respectively. The I-BSA diluent was superior to skim milk for motility maintenance during incubation (74.0 vs 63.7%). The effect of diluent on sorting was investigated in Experiment 3 using a range of H33342 concentrations and incubation durations. The clear (1% BSA) diluent improved the split ratio compared with the opaque (skim milk) diluent (0.17 vs 0.08), with an optimum staining time of 45 min using 0.09 mM H33342. In conclusion, a diluent containing 1% fatty acid free, low endotoxin BSA in lieu of skim milk improved the sorting efficiency and motility characteristics of stallion sperm after storage for 18 h.