This study uses the comsumption survey of Taiwan Province with 12, 734 households in 1989, cross section data, as the source, The Tobit model is employed in an effort of accomplish threc purposes: (1)To explore the marginal propensity (both short-run and long-run) of dairy product expenditures for the proposed continuous variables, i.e. disposable income, numbers of abults, numbers of minors, and age of household head. (2)To analyze the differdnces among dairy product expenditures for defined category variables, i.e. agri, or non-agri, households, occupation of the household head, and education of the household pead. (3)To draw policy implications. All proposed variables are statistically significant without exception. Main findings and implications of this study are: (1)Household heads with higher disposable income are inclined to have greater expenditures for purchasing dairy products. The total response (TR), short-run response (SR), and market participation response (MPR), in order, are 0.444 0.401 and 0.043. (2)Higher household head's age shows less expenditure for purchasing dairy products. The TR, SR, and MPR, in order, are -0.623, -0.574 and -0.049. (3)Both numbers of household's adults and minors express a postive impact. The former is relatively more important. The TR, SR and MPR of numbers of adults, in order, are 0.704 0.657 and 0.047. The TR, SR and MPR of numbers of minors, on the other hand, are 0.336, 0.314 and 0.022, respectively. (4)The variables reveal that the dairy product expenditure of non-agri. household is higher than that of argi. household's. Houeshold heads with white-collar occupations are the dominant group. Blue-collar household heads show higher expenditures than those of agri. workers. Years of household head scholling have a positive influence on household's dairy product expenditures. Market expansion, in terms of enticing new users, may be neglected due to the fact that the market participation responses of all defined variables are very small. Efforts should be taken to promote current customers to buy more frequently and expend greater amounts on each purchase. In addition to age of household geads, the remaining nine variables show significantly positive impacts on dairy product expenditure. The consumption of dairy products is expected to increase in the future.