To utilize lupin seeds for food and pharmaceutical applications, lupin seeds were pretreated to remove oil using hexane or carbon dioxide. Two types of lupin protein isolate were prepared. Both types of protein isolate showed good foaming activity, comparable to egg white. Protein isolate extracted under acid conditions showed higher foaming activity than protein isolate extracted at neutral pH. The lipoxygenase activity was much reduced in both of the protein isolates. The protein isolate extracted at neutral pH showed a stronger angiotensin converting enzyme inhibition than the protein isolate extracted under acidic pH. In contrast, the protein isolate extracted under acid conditions had a greater sodium cholate binding capacity, comparable to that of cholestyramine. Lupin samples showed less DPPH radical scavenging activity than deoiled soybean. The deoiling method did not affect the functional properties, lipoxygenase activity, angiotensin converting enzyme inhibition, sodium cholate binding, and radical scavenging activity.