The report that addition of KI03 (0·1 mm) to milk before ultra high temperature (UHT) treatment induces extensive proteolysis during subsequent storage at 37 °C was confirmed. None was produced by addition of H202 KMn04 or K2Cr207. The pH optimum for KI03-induced proteolysis was between 7·0 and 8·0 and the temperature optimum 37—45 °C. β-Casein was particularly susceptible and the proteolysis pattern was similar to that caused by indigenous alkaline milk proteinase (MPA, plasmin). Addition of plasmin to milk before UHT treatment (140 °C/10 s) caused slight proteolysis during subsequent storage but addition of 0·1 mm-KI03 and plasmin caused extensive proteolysis which was prevented by addition of soyabean trypsin inhibitor, indicating the probable involvement of plasmin in KI03-induced proteolysis in UHT-treated milk. Equally extensive proteolysis occurred in serum protein-free casein micelle systems (SPFCM), with or without KI03, during storage at 37 °C following UHT treatment, indicating a role for whey proteins in KI03-induced proteolysis. Addition of β-lactoglobulin (β-lg) to a SPFCM system inhibited proteolysis, but extensive proteolysis occurred in a SPFCM system containing both β-lg and KI03. MPA-free Na caseinate (prepared by heating at 140 °C for 7 min) underwent extensive proteolysis when treated with plasmin before UHT treatment; proteolysis was inhibited by addition of °-lg to this system and KI03 reversed the inhibitory effect of β-lg. Plasmin proteolysis of isolated αs1-casein was inhibited by denatured β-lg (90 °C/30 min) at a level of 4 mg/ml but not by native β-lg. When denatured in the presence of KI03, β-lg had a lower free SH content than the control and was less inhibitory for plasmin in proteolysis of isolated αsl-casein. The results show that denatured β-lg inhibits plasmin proteolysis of caseins in UHT milk and that inhibition is prevented by KI03. This inhibition may occur via thiol–disulphide interchange, which is prevented if the SH group of ²-lg is oxidized by KI03, thus permitting the stimulatory effect of KI03 on proteolysis in UHT-treated milk.