Abstract: The objective of this study was to dry sweet liquid whey using drum dryer and to utilize the whey powder in French-type bread and cookies as a sugar substitute. The sweet whey powder was characterized chemically for ash, moisture, water activity, protein, salt, acidity and lactose contents. Optimization parameters including drying temperature, drum speed and starch addition for whey drying by drum dryer were tested to produce the best powder characteristics. The optimum temperature was 140°C at a drum speed of 20 rpm with a corn starch level of 2% (weight per weight). Sweet whey powder produced was used as a sugar replacer in French-type bread and butter cookies at substitution levels of 25, 50 and 75% of total sugars. The developed products were analyzed chemically and sensorially. The two developed products were relatively high in protein, ash, lactose and salts compared to the control samples. Regarding the sensory evaluation, the results showed that the sugar substitution of 25 and 50% in bread and cookies were significantly (p<0.05) better than the control. It can be concluded that sweet whey powder can significantly improve the quality of the studied bakery items.