Flour particle size (PS) distribution plays a crucial role in determining the functional properties of starch, protein, and influences the nutritional properties, which ultimately is reflected in the end-product quality. For stone-milled whole wheat flour (WWF) bakers often prefer finer PS for improved color and texture, despite this can sometimes negatively affect other quality aspects. Therefore, understanding the contribution of PS reduction on the functional properties of stone-milled WWF is crucial. This study investigated Hard Red Spring (HRS) WWF of which the mean PS was reduced from 151 μm to 117 μm, the possible finest PS by a “Kombi mill type A 500 MSM” stone mill. PS reduction increased starch damage from 6.58% to 6.71%. Also, the amylose content reduced from 31.7% to 29.4%. However, an increase in syneresis, solubility, oil-holding capacity, and peak viscosity was observed. Glutopeak and wet gluten showed an increased gluten strength. Glutenin/gliadin, polymeric/monomeric protein ratios, and percentage of unextractable polymeric protein were increased by 2.10%, 4.11%, and 4.55%, respectively, indicating increased availability of proteins with relatively larger molecular sizes by PS reduction. The relative proportion of glutenin and gliadin subgroups were also changed. Dietary fiber and resistant starch contents were found to be lower. However, the reduction in phytic acid and FODMAPs is considered beneficial. PS reduction ultimately improved bread loaf volume and crumb structure. Overall, PS reduction of WWF by stone-milling brought positive changes to several functional properties of protein and starch and positively improved the dough rheology and end-product quality.