The purpose of this study was to optimise process parameters to prepare spray-dried honey-based milk powder containing functional properties of honey. Experimental design with temperature (180 to 200 °C), honey concentration (5–15%) and feed flow rate (8–10 rpm) as independent variables was studied to investigate the effect on product responses. Results showed that increasing the temperature resulted in powder with lower moisture, bulk density, antioxidant activity, total phenolic contents, total flavonoid contents and higher water solubility index. Increasing feed flow rate resulted in higher moisture, bulk density, antioxidant activity, reduced water solubility index, total phenolic content and total flavonoid content, whereas increasing honey concentration resulted in increase in antioxidant activity, total phenolic content and total flavonoid content. The moisture content, bulk density, water solubility index, DPPH scavenging activity, total phenolic content and total flavonoid content were 3.27%, 0.44 g cc−1, 96.67 g g−1, 17.45%, 2.54 GAE g−1 powder and 1.40 RE g−1 powder, respectively.