It has been well recognized that dietary proteins provide a rich source of biologically active peptides. Today, milk proteins are considered the most important source of bioactive peptides and an increasing number of bioactive peptides have been identified in milk protein hydrolysates and fermented dairy products. Bioactive peptides derived from milk proteins offer a promising approach for the promotion of health by means of a tailored diet and provide interesting opportunities to the dairy industry for expansion of its field of operation. The potential health benefits of milk protein-derived peptides have been a subject of growing commercial interest in the context of health-promoting functional foods. Hence, these peptides are being incorporated in the form of ingredients in functional and novel foods, dietary supplements and even pharmaceuticals with the purpose of delivering specific health benefits.