A continuous process for treatment of dairy wastewater with immobilized lactic acid bacteria has been demonstrated at pilot scale. A strain of Lactobacillus plantarum was selected on the basis of a high conversion rate of lactose at low pH, a high affinity of lactose at low concentrations, and the ability to retain activity for a long time immobilized in alginate beads. Lactose was converted to lactic acid, which lowered the pH and precipitated milk proteins. The proteins were separated together with milk fat by flotation with carboxy methyl cellulose (CMC) or chitosan and gave a solid phase of approx. 10% dry matter (23% protein and 68% fat). The total chemical oxygen demand (COD,) removed varied from 65 to 78% for CMC and 49 to 82% for chitosan. The precipitated material was used as a feed supplement for pigs to provide up to 30% of the total energy intake. No adverse effects on the pig's performance were observed. The energy feed value of the precipitate was estimated to be 2.0 feed units (FUs) per kg dry matter.