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The prospecting for nutrients has catapulted whey protein to the forefront of the functional food sector. This protein, filtered from cheese whey, has been characterized to contain a plethora of healthy components such as essential amino acids, bioactive peptides, antioxidants and immunomopotentiators. Consequently, whey protein has been validated to confer radical scavenging, anti-inflammatory, antitumour, immunostimulatory, hypotensive, gut homeostasis, antiobesity, antidiabetic, muscle biosynthesis, osteoprotective and radioprotective roles. As the multifarious benefits of whey protein cumulate amidst the dramatic rise in metabolic and degenerative health issues, it seems imperative to harness their potential. This review presents the significant biological aspects of whey protein and its derivatives. Further, it rationalizes their incorporation in functional foods.