Green’s Dictionary of Slang

1. to spend all one’s money.

1862		Golden Age (Queanbeyan, NSW) 4 Sept. 3/1: Was at Kiandra when it first broke out; made a nice little pile, £800; went to Sydney, and lambed it all down. Ah, well! a fellow can't have his money and spend it.
1888		Australia’s First Century 644: He partakes himself to a public-house. Arrived there, he hands his cheque to Boniface, and proceeds to ‘lamb down’ its amount, and the public-house loafers indulge in the luxury of a several days ‘drunk.’.
1908		G. Seagram Bushmen All 314: The ‘lambing-down’ process was going on merrily. Liquor was flowing freely at a shilling a nobbler.

2. to take all of an opponent’s money, e.g. when gambling.

1881		Bulletin (Sydney) 2 Apr. 4/1: Enter Jimmy, sen. Loq: ‘I can’t play you billiards, Mr— but my son Jimmy can. Wait till I bring him a stool to stand on.’ [...] P.S.—And ‘Jimmy’ did lamb down the squatter.
1895		C. Crowe Aus. Sl. Dict. 43: Lambing Down, winning a man’s money in gambling or other trickery.

3. to persuade someone to spend all their money on alcohol; also attrib.

1886		Marlborough Exp. (NZ) 29 Dec. 2/6: ‘Lambing Down’ [...] Bushmen, with large cheques, continue to pour into the city. It is expected that the lambing-down will go on briskly.
1886		Daily Tel. 20 Mar. n.p.: Then the unhappy man would, in bush parlance, jump his horse over the bar, that is to say, he would, for a paltry sum, sell his horse, saddle and bridle, and all, to the lambing-down landlord [F&H].
1892		H. Lawson ‘Tambaroora Jim’ in Roderick (1967–9) I 183: He wasn’t great in lambing down, as many landlords are.
1894		Kilmore free Press 1 Feb. 1/2: He was one of those many unfortunates [...] who, when in town, hand their cheques for a whole year’s wages to the landlord of a public house and ‘lamb down’ (remain drinking and make others drink) until [...] they have knocked down their cheque.
1900–10		‘The Broken-Hearted Shearer’ Stephens & O’Brien Materials for a Dict. of Aus. Sl. [unpub. ms.] 93: And he called for a nobbler at a wellknown house in town, / Where the bar-maids they were cautious for they lamb a fellow down.
1908		Taranaki Herald (NZ) 8 Oct. 2/3: The recent ‘lambing down’ case in Gisborne was heard today, when Joseph Burke, ex-licensee [...] was found guilty of supplying liquor to George Pearson while in a state of intoxicaton.
1914		Bulletin (Sydney) 1 Oct. 43/2: [I]n the glorious days of lambing down, when Jerry was younger and grew fat and independent, he dispensed some astonishing mixtures – known as tanglefoot, snake-juice, paralysers, double-distilled lightning, mulga rum and blue-murder rousers.
1972		B. Wannan Folklore of the Aus. Pub 127: The evil practice of ‘lambing down’, pursued by unscrupulous publicans and shantykeepers during the last century, consisted of ‘fleecing’ the patron — whether shearer, station hand [...] or other rural tradesman, who handed over his annual (or seasonal) pay-cheque and asked Mine Host to ‘cut it out’: that is, supply as much liquor as would cover the cheque’s value.

4. (also lam down) to calm someone down.

1885		Bulletin (Sydney) 12 Sept. n.p.: That ‘lambing-down’ at the Yoricks at the Johnsonian fish-supper was a failure, and when he went North with Sir Thomas, the understanding they had apparently arrived at about a little mutual back-scratching leaked out, to their mutual disgust.
1895–9		H. Lawson ‘The Story of the Oracle’ in Roderick (1972) 282: It took two of Jimmy’s mates [...] to lam him down into a comparatively reasonable state of mind.