Meloxicam (MLX), a non-steroidal anti-inflammatory drug (NSAID) and a selective COX-2 inhibitor is a water insoluble drug (about 12 microg/ml). In order to improve the aqueous solubility of the drug and its dissolution rate, physical mixture and solid dispersions with skimmed milk were prepared and investigated. Enhancement of aqueous solubility of MLX was observed with solid dispersion of the drug with skimmed milk due to amino acids and surface active agents content in the milk, which can be used for the treatment of gastric disturbance. Rotary vacuum evaporation technique was used to prepare solid dispersion. Results showed that the solubility of solid dispersion of the drug was almost three times greater than the pure drug. Similarly, the solid dispersion of the drug indicated a significant improvement in the dissolution of the drug as compared to the physical mixture and the pure drug. Differential scanning calorimetry, X-ray diffraction and scanning electron microscopic analysis revealed the formation of solid dispersion of the drug with skimmed milk.