Whey proteins were hydrolyzed in a membrane recycle reactor (MRR) in the presence of Alcalase 0.6L under varying enzyme to substrate ratios and residence times. Substrate conversion was directly dependent on these two parameters, and at a fixed enzyme-substrate ratio of 10%, conversion levels could be controlled through residence time, resulting in peptide permeates with homogeneous molecular and functional properties. In addition, recycling of the enzyme and elimination of peptide products resulted in much improved enzyme yields and process productivity levels. However, the process was only operational for 7 h, given membrane fouling and enzyme inactivation phenomena whose contribution occurred in a time-dependent manner. Changes in process design leading to increased reactor stability were examined, and the system is considered to provide a suitable basis for the production of peptides with specific functional and nutritional properties at the industrial level in the future.