This project investigated the contribution of gastric and pancreatic enzymes to some physicochemical and biological activity characteristics of whey protein hydrolysates. Depending on the method of isolation, and particularly on the zymogen activation conditions, it was shown in this study that the endoproteinase and exopeptidase activities in pancreatic preparations can exist in different ratios. Furthermore, it has been shown that certain physicochemical characteristics of whey protein hydrolysates can be altered by manipulation of the zymogen activation conditions of pancreatic protease preparations. Novel whey protein derived peptide inhibitors of angiotensin I converting enzyme (ACE), generated using pancreatic proteinases, have been identified in this study. Differential scanning calorimetry (DSC) was used to study the thermal stability of an enriched fraction of [3-lactoglobulin. The susceptibility of (3-lactoglobulin to hydrolysis by gastric and pancreatic proteinases was related to the thermal stability of the protein. A pilot scale (tangential crossflow plate and frame) ultrafiltration system was investigated with the view to developing a procedure for the fractionation and continuous hydrolysis of whey proteins.