Milk is an ideal nutritional base for lifestyle beverages, providing both functionality and basic nutrition. It is a complete food source, containing all the major macro- and micro-nutrients, i.e., protein, fat, carbohydrate, minerals and vitamins needed to formulate nutritional, therapeutic and medical and/or sports beverages. Researchers at Teagasc have studied the effect of the interaction between composition and processing parameters on in-process and finished product functionality, and identified the key constraints to beverage manufacture. Studies have demonstrated that feed type (e.g., grass fed), stage of lactation and milk quality influence the formulation dynamics of dairy-based beverages. Selection of protein ingredients, and knowledge of their thermal history, is key to optimising functionality in the final reconstituted formulation. For example, increasing the α-lactalbumin to β-lactoglobulin ratio of a first stage infant formulation (i.e., 1.3% protein (60:40 casein:whey) 7.4% lactose and 3.4% fat) resulted in a significant (P < 0.05) reduction in powder particle PSD D(4,3) size and viscosity of the reconstituted formulation. In addition, increasing α-lactalbumin content reduced the rate of thermal gelation on addition of calcium and magnesium. Other strategic priorities at Teagasc include adaption of technology to create a “digital dairy” platform of research within the food program. This area includes food biomechanics, digital mapping and virtual / augmented reality applications for visualization of internal powder structure. When coupled with formulation strategies, the continued integration of digital technology is seen as a significant development for the dairy-based nutritional beverage sector.