Increasing demand for dairy products in Malaysia is driving government initiatives and structural change in the domestic dairy industry in order to increase competitiveness and self-sufficiency. This study endeavours to investigate the drivers of increasing dairy demand by examining the factors influencing Malaysian consumers‟ consumption and perceptions of various types of dairy products. A survey of 435 respondents was conducted and the data were analysed using logit models. The results indicate that demographic variables such as age and ethnicity as well as other attitudinal variables significantly influence consumers‟ increasing consumption of dairy products. Managerial recommendations for the domestic dairy industry are suggested and policy implications are discussed.