Lactose is a form of sugar which is the most abundant component of milk of most mammals. Pure lactose is mainly extracted from whey and throughout the value chain process lactose is converted into lactose pharma grade and then into lactose derivative such as galactose, lactulose, lactitol, lactobionic acid, galacto-oligosaccharides (gos), lactosucrose, sialyllactose and tagatose. Lactose consists sugar, glucose and galactose which are the source of instant energy. In dairy products fat content is higher as compared to lactose. Among dairy products, dry milk and whey consist of higher lactose than cheese. Commodities from permeate power and specialty products such as lactose pharma and GOS are expected to witness increased growth compare to other lactose and derivative products. Lactose and derivative has dietary fibre, prebiotic properties. Lactose and derivative also enhance the absorption of calcium and magnesium. New product development using lactose derivative are owing to increased commercialisation is expected to drive the demand for lactose and derivative market in the near future. End-use industries for instance, Pharma, Nutrition, Healthcare, Food, Beverages and Feed use lactose and derivative as semi-finished products. In terms of production, USA, European Union, New Zealand and Australia hold major lactose and derivative market share globally.