Cream cheese is a fresh cheese traditionally made from milk and cream through acidification using rennet and mesophilic starter culture with high fat content >25% in the resulting product. It has a soft, creamy, smooth and spreadable texture with a slightly acidic taste and mainly used as spread or ingredient of cheesecake. However, the risks associated with high fat intake has led to an increased demand for lowfat cream cheese. Reducing the fat content incorporates textural and sensory defects that significantly impact consumer acceptability; therefore, this project aimed to develop functional cream cheese with low-fat content that is sensorially acceptable. The primary focus of this work was to investigate the effect of fat and fat replacer (β-glucan and phytosterols) on the microstructure, texture, flow, lubrication, flavour profiles and oral perception of cream cheese. Phytosterols (emulsified and esterified) and βglucan were selected as fat replacers to alter the function of fat in cream cheese structure, also keeping in view of their health benefits. Further, probiotic Lactobacillus rhamnosus was also incorporated to improve the flavour and functionality of low-fat cream cheese.The confocal micrographs presented the structure of cream cheese as casein network with fat globules interspersed in between the casein that prevented casein aggregation. Reduced-fat cream cheese (0.5% fat) exhibited fewer fat globules and a denser structure compared to their high-fat (11.6% fat) counterparts due to the stronger electrostatic and hydrogen bonding between casein molecules that made the cream cheese network more elastic, firm, sticky, less spreadable with low lubrication properties. To modify the dense protein structure of the reduced-fat cream cheese, different homogenisation pressures (0, 25, 100 MPa) and mixing speeds (750, 1500, 3000 rpm for 2 and 4 minutes) were applied to the milk and cream cheese curd, respectively. Compared to unhomogenised milk (0 MPa), increased homogenisation pressure (100 MPa) created smaller fat globule size that were distributed evenly in the casein matrix. This led to a firm texture and more viscous cream cheese due to collision and reaggregation of small fat globules with casein. However, increasing the speed and mixing times (3000 rpm for 4 minutes) further reduced the curd particle size that improved spreadability and lubrication properties of the cream cheese. Thus, high-speed mixing of cream cheese curd from unhomogenised milkproduced reduced-fat cream cheese (5.5% fat), with textural quality identical to high-fat cream cheese.Fat has a major role to play, providing cream cheese its characteristic smoothness and creaminess.Phytosterols and β-glucan are potential fat replacers in low-fat products such as cream cheese due to the ability of β-glucan to bind water and the similar structure of phytosterols to animal fat. But their iii application in cream cheese has not been reported and hence investigated in this study. It was found that both β-glucan and phytosterols improved the lubri...