Gluten-free food products are in demand due to the gluten sensitivity of individuals around the globe. Lipopeptide biosurfactants are widely used in food formulations for wetting, foaming, emulsion stabilization, anti-adhesive and anti-microbial properties. Lipopeptide biosurfactantscan be used for gluten utilization and the formulation of food products. The strain Bacillus licheniformis MS48 was isolated from the marine sponge associated bacteria and found to be the ideal biosurfactant producer with an emulsification activity of 70%. Biosurfactant production was optimized using lactose, yeast extract, and sodium chloride (NaCl). The 1,1-diphenyl- 2-picryl hydrazyl (DPPH) radical scavenging activity was found to increase with an increase in the concentration of biosurfactant. The conformation changes in the gluten due to the treatment of lipopeptide biosurfactant was identified by thiol quantification and scanning electron microscopy. With the addition of lipopeptide MS48 to cookie dough, cookies with softer and smooth textures were developed. The conformation changes in the gluten in the lipopeptide incorporated cookie dough was visualized by scanning electron microscopy. The lipopeptide biosurfactant incorporation in cookie dough causes appropriate changes in the structural network of gluten. The lipopeptide-incorporated cookies had improved the spread factor and texture. Lipopeptide biosurfactant with effective radical scavenging activity aided in the utilization of gluten. Incorporating lipopeptide in cookie dough assisted in the production of cookies with improved textural and sensory properties. This study is a novel approach to the application of lipopeptide biosurfactant in gluten utilization for the development of cookies. © 2023 Society of Chemical Industry.