Dairy farming played an important role in the socio-economic livelihood of the dairy farmers as its importance to generate additional income when limited access to raw milk market or value of liquid milk sold economically lesser than that of value-added milk products. The present study was conducted in eight districts of Punjab state in 2018. Fifty farmers were selected by simple random sampling method and categorized into small, medium and large on the basis of the quantity of the milk produced per day by cumulative cube root frequency method. The level of value addition to milk was highest i.e. 19.95 per cent at a large farm, 17.87 per cent at medium farm and 13.89 per cent at small farm. The socio-economic characteristics of dairy farmers revealed that 66 per cent farmers of age group 30-40 years, 62 per cent educated up to higher secondary level, 68 per cent family size of 4-6 members while 58 per cent with 2-4 years of experience in value addition as manufacturing of milk products. The level of value addition of milk increased significantly with an increase in farm size (0.788), herd size (0.870), total milk production per day (0.974), crossbred cows (0.944) and milk yield per animal per day (0.706).

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