Freshly drawn milk contains indigenous enzymes, including proteases and lipases. During handling and processing, milk acquires contaminating bacteria that produce further proteases and lipases, adding to the enzyme loading in the milk. Even when several heat treatment steps are used to prepare milk products, these will not be sufficient to inactivate all of the enzymes. Adverse effects of heat on the product limit the extent of heat treatments that can be used. The activities of proteinases and lipases that survive the heat treatments may cause changes in functionality and flavour of milk products, including milk powders, during storage. This review focuses on the characteristics of proteases (specifically proteinases) and lipases in milk and milk powders, detection methods for such enzymes and the effects of these enzymes on milk and milk powders during storage.