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Summary Peanut meal (PM), a by‐product of processing, is hard to recycle due to its poor functional properties affected by the processing environment. To increase its utilisation value, atmospheric cold plasma (ACP) technology was used to enhance the functional properties of PM. Results showed that the soluble protein concentration, water holding capacity, surface hydrophobicity, foaming and emulsifying properties of PM were significantly improved after ACP treatment. The changes in amino acid composition, surface element content, apparent conformation, Fourier transform infrared spectroscopy and secondary structure of the protein in PM indicated that ACP treatment promoted the interaction between components of PM by introducing oxygen‐containing groups and producing etching. The protein molecule tended to be flexible, so as to improve the overall function of PM. ACP could be an effective and promising method to improve the functional properties of agricultural by‐products for further utilisation.