β-Galactosidase is an essential enzyme for the metabolism of lactose in human beings and has an important role in the treatment of lactose intolerance (LI). β-Galactosidase expressed by intestinal microflora, such as lactic acid bacteria (LAB), also alleviates LI. A promising approach to LI management is to exploit a food-grade LAB delivery system that can inhabit the human intestine and overproduce β-galactosidase. In this study, we constructed a food-grade β-galactosidase surface display delivery system and then integrated into the chromosome of Lactococcus lactis (L. lactis) NZ9000 using recombination. Western blot and immunofluorescence analyses confirmed that β-galactosidase was expressed on the cell surface of recombinant L. lactis stain NZ-SDL. The whole-cell biocatalyst exhibits Vmax and Km values of 121.38 ± 7.17 UONPG/g and 65.36 ± 5.54 mM, based on ONPG hydrolysis. The optimum temperature for enzyme activity is 37 °C and the optimum pH is 5.0. Activity of the whole-cell biocatalyst is promoted by Mg2+, Ca2+, and K+, but inhibited by Zn2+, Fe2+, and Fe3+. The system has a thermal stability similar to purified β-galactosidase but better pH stability, and is also more stable in artificial intestinal juice. Oral administration and intraperitoneal injections of NZ-SDL in mice cause no detectable health effects. In conclusion, we have successfully constructed a food-grade gene expression system in L. lactis that displays β-galactosidase on the cell surface. This system exhibits good enzyme activity and stability in vitro, and is safe in vivo. It is therefore a promising candidate for use in LI management.