Gastrointestinal disease (GI) is the most common illness in pre-weaned dairy calves. Therefore, effective strategies to manipulate the microbiome of dairy calves under commercial dairy operations are of great importance to improve animal health and reduce antimicrobial usage. The objective of this study was to develop a farm-specific FMT product and to investigate its effects on clinical outcomes and fecal microbial composition of dairy calves. The FMT product was derived from feces from healthy donors (5–24 days of age) raised in the same calf ranch facility as the FMT recipients. Healthy and diarrheic calves were randomly enrolled to a control (n = 115) or FMT (n = 112) treatment group (~36 g of processed fecal matter once daily for 3 days). Fecal samples were collected at enrollment and again 9 days later after the first FMT dose. Although the FMT product was rich in organisms typically known for their beneficial probiotic properties, the FMT therapy did not prevent or ameliorate GI disease in dairy calves. In fact, calves that received FMT were less likely to recover from GI disease, and more likely to die due to GI disease complications. Fecal microbial community analysis revealed an increase in the alpha-diversity in FMT calves; however, no major differences across treatment groups were observed in the beta-diversity analysis. Calves that received FMT had higher relative abundance of an uncultured organism of the genus Lactobacillus and Lactobacillus reuteri on day 10. Moreover, FMT calves had lower relative abundance of Clostridium nexile and Bacteroides vulgatus on day 10. Our results indicate the need to have an established protocol when developing FMT products, based on rigorous inclusion and exclusion criteria for the selection of FMT donors free of potential pathogens, no history of disease or antibiotic treatment.