Value-added applications are needed for peanut meal, which is the high-protein by-product of commercial peanut oil production. Peanut meal dispersions were hydrolyzed with alcalase, flavourzyme and pepsin in an effort to improve functional and nutritional properties of the resulting water soluble extracts. Degree of hydrolysis (DH) ranged from 20 to 60% for alcalase, 10 to 20% for pepsin and 10 to 70% for flavourzyme from 3 to 240 min. Low molecular weight peptides (<14 kDa) and unique banding patterns reflected the different proteolytic activities of each enzyme as determined by sodium dodecyl sulfate-polyacrylamide gel electrophoresis. Total soluble solids and soluble nitrogen increased a minimum of 30 and 110%, respectively, for all hydrolysates after 4-h hydrolysis. Differences in air/water adsorption responses of hydrolysates were a function of protease specificity. Antioxidant capacities of all hydrolysates were greater than unhydrolyzed controls and correlated linearly (R2 = 0.87) with DH, whereas antioxidant capacities of hydrolysates were minimally dependent on bicinchoninic acid protein solubility or relative amino acid distribution.