In many litter-bearing mammals and in a few viviparous reptiles the sex ratio of the entire brood or the sex of the adjacent fetuses induces sex-specific differences in the hatchling's phenotype. This study examines whether the sex of incubation neighbours affects hatchling characteristics in oviparous common lizards (Lacerta vivipara). Oviparous common lizards lay eggs with thin eggshells and, therefore, are an optimal model organism for studying the effects of hormone leakage among developing embryos since the strongest evidence for prenatal sex ratio effects on offspring development comes from viviparous populations of the same species. Groups of three eggs were incubated together and were categorised according to the sex of the resulting hatchlings as either homosex (three hatchlings of the same sex) or heterosex (one male or one female hatchling plus two siblings of the opposite sex). Hatchlings incubated adjacent to siblings of the same sex had larger body mass and body condition. Males tended to have lower ventral scale counts when incubated with other males. Conversely, females tended to have more ventral scales when incubated with other females, indicative of a more feminised phenotype. There was also a significant interaction between hatchling sex and incubation environment with respect to the length of the fourth digit of the hindlimb, likely indicative of masculinisation in heterosex females. This study suggests steroid diffusion between adjacent eggs in a minimally manipulative experiment and provides the first evidence for developmental effects of the exogenous hormonal environment in near natural conditions in an oviparous amniote. Implications of these results for the evolution of within-clutch sex ratio are discussed.