Despite very small genomes, mycoplasmas retain large multigene families encoding variable antigens whose exact role in pathogenesis needs to be proven. To understand their in vivo significance, we used Mycoplasma agalactiae as a model exhibiting high-frequency variations of a family of immunodominant Vpma lipoproteins via Xer1-mediated site-specific recombinations. Phase-Locked Mutants (PLMs) expressing single stable Vpma products served as first breakthrough tools in mycoplasmology to study the role of such sophisticated antigenic variation systems. Comparing the general clinical features of sheep infected with a mixture of phase-invariable PLMs (PLMU and PLMY) and the wild type strain, it was earlier concluded that Vpma phase variation is not necessary for infection. Conversely, the current study demonstrates the in vivo indispensability of Vpma switching as inferred from the Vpma phenotypic and genotypic analyses of reisolates obtained during sheep infection and necropsy. PLMY and PLMU stably expressing VpmaY and VpmaU, respectively, for numerous in vitro generations, switched to new Vpma phenotypes inside the sheep. Molecular genetic analysis of selected 'switchover' clones confirmed xer1 disruption and revealed complex new rearrangements like chimeras, deletions and duplications in the vpma loci that were previously unknown in type strain PG2. Another novel finding is the differential infection potential of Vpma variants, as local infection sites demonstrated an almost complete dominance of PLMY over PLMU especially during early stages of both conjunctival and intramammary co-challenge infections, indicating a comparatively better in vivo fitness of VpmaY expressors. The data suggest that Vpma antigenic variation is imperative for survival and persistence inside the immunocompetent host, and although Xer1 is necessary for causing Vpma variation in vitro, it is not a virulence factor because alternative Xer1-independent mechanisms operate in vivo, likely under the selection pressure of the host-induced immune response. This singular study highlights exciting new aspects of mycoplasma antigenic variation systems, including the regulation of expression by host factors.