During the manufacture of skim milk powder, many important alterations to the casein micelles occur. This study investigates the nature and cause of these alterations and their reversibility upon reconstitution of the powders in water. Samples of skim milk and powder were taken at different stages of commercial production of low-, medium-, and high-heat powders. The nature and composition of the casein micelles were analyzed using a variety of analytical techniques including photon correlation spectroscopy, transmission electron microscopy, turbidity, and protein electrophoresis. It was found that during heat treatment, whey proteins are denatured and become attached to the casein micelles, resulting in larger micelles and more turbid milk. The extent of whey protein attachment to the micelles is directly related to the severity of the heat treatment. It also appeared that whey proteins denatured during heat treatment may continue to attach to casein micelles during water removal (evaporation and spray-drying). The process of water removal causes casein and Ca in the serum to become increasingly associated with the micelles. This results in much larger, denser micelles, increasing the turbidity while decreasing the viscosity of the milk. During reconstitution, the native equilibrium between colloidal Ca and serum Ca is slowly reestablished. The reequilibration of the caseins and detachment of the whey proteins occur even more slowly. The rate of reequilibration does not appear to be influenced by shear or temperature in the range of 4 to 40 degrees C.