The effect of dead volume on the power output and efficiency of an alpha-Stirling engine is investigated in the form of an exploratory parameter study using the third-order simulation software Sage. This paper aims at identifying the underlying mechanisms in order to better understand the resulting design implications of this phenomenon that is in clear contradiction to what can be found in the literature. It turns out that additional ‘passive’ dead volume that does not even take part in the heat transfer processes leads to a phase shift of the pressure, resulting in increased pV-work output, especially at lower heat source temperatures. Of even greater significance, dead volume has a positive effect on the efficiency at lower heat source temperatures by reducing the temperature swing in the heat exchangers and by bringing the gas temperatures closer to the wall temperatures of the respective heat exchangers, and thus increasing the effective temperature difference. Furthermore, to a large extent the beneficial effects of dead volume can also be achieved by changing the phase angle.