Lactobacillus fermentum V10 was able to show large capsules surrounding the cell surface and produced 247.37±0.76 mg/L polysaccharides in fermentation medium. The effect on technological properties of low-fat dahi found to be significantly (P < 0.01) improved for Lactobacillus fermentum V10 than control dahi made by EPS + Lb. delbrueckii subsp. bulgaricus NCDC 285 and EPS − Lb. delbrueckii subsp. bulgaricus 09 cultures. Low fat dahi prepared by exopolysaccharides producing Lactobacillus fermentum V10 exhibited optimum acid production, lesser whey separation, higher viscosity, increased adhesiveness and stickiness whereas decreased firmness and work of shear as compared to control dahi.