Background and objectives: From 2017 to 2020, global milk production ranged from 610,724 to 643,769 thousand tons, but the dairy industry still faces issues related to its carbon footprint and sustainability. According to the United Nations Sustainable Development Goals (SDGs), by 2030, food processors, governmental bodies, and consumers should take actions regarding food production patterns and consumption to decrease the generation of by-products and side-streams and increase their circularity by developing nutritious-rich products. Dairy products have traditionally been manufactured without bioactive ingredients to boost consumers' health and well-being. To achieve the sustainability goals and the need to reformulate traditional dairy foods to make them more nutritious and reduce their carbon footprint, it is paramount to implement integrated approaches that embody the "farm to fork" ethos.Scope and approach: This review integrates concepts of food science, technology, nutrition, circular economy, and sustainability to provide an overview of the technological applications of dietary fibre, polyphenols, functional lipids, and carotenoids obtained from agro-industrial side-streams in dairy food formulations.Key findings and conclusions: Dairy processors can use bioactive ingredients and extracts obtained from agroindustrial side-streams to design potentially functional food models and tentatively market these products with nutritional claims or even with a health claim in case the bioactivity is verified in human intervention trials. This approach will increase the nutritional value of traditional dairy foods and contribute to circularity within food systems, reducing food waste, and enhancing human health.