An oil palm is perennial crop. The palm begins to bear fruits 2-3 years after planting and has an economic life of about 25 years. Among the oil crops, the oil palm is the most prolofic oil producing plant. In Malaysia, the commercial planting material is Tenera which yields about 4 tonnes of palm oil, 0.5 tonne palm kernel oil (PKO) and 0.6 tonne Palm kernel cake (PKC) per hectare per year on the average. An oil palm fruit yields two types of oil, crude palm oil (CPO) and palm kernel oil (PKO). CPO and PKO are extracted from the mesocarp and kernel of the oil palm fruit respectively. They are chemically different and have between them practically the entire range of long, medium and short chain fatty acids. CPO contains mainly palmitic (C16:0) and oleic acid (C18:1), the two most common fatty acids in nature, and is about 50% saturated, while PKO contains mainly lauric acid (C12:0) and is more than 80% saturated. Based on their chemical and physical properties, two large industries have been established namely palm-based food industry and oleochemical industry. In addition, the presence of healthy components such as carotenes and vitamin E as well as its high content of monounsaturates has made palm oil a nutritious edible oil. About 80% of palm oil find its way into food products, leaving about 20% for non-applications. MPOB’s R&D efforts have, over the last few years, producers many new palm-based products. The food products include Trans-free vanaspati, santan power, Trans-free margarine, pourable margarine, microencapsilated palm oil-based products, non-dairy ice cream, shortnings, cocoa butter substitute, reduced fat spread, Trans fatty acid free food formulation, palm olein salad dressing, etc. There are many useful minor components in crude palm oil. Among the more important ones are carotenes, tocols (30% tocopherols and 70% tocotrienools), sterols and squalene. Until recently, many of these minor components have been lost during refining :- all carotenes are destroyed and about 30% of vitamin E is condensed in palm fatty acid distillate, a by-product during refining of palm oil. Process have been developed to recover these minor components and these have contributed to the emergence of nutraceutical industry that produces tocopherol and tocotrienol capsules, carotene rich palm oil and palm carotene concentrate. Palm oil also finds many of its applications in olelchemical industry. Coconut oil and tallow are the traditional raw materials for oleochemicals. However, because of their similarity in fatty acid composition, palm oil, palm stearin and palm kernel oil have been accepted as better alternatives. In fact, palm oil and palm kernel oil offer more advantages: •They are more reliable in supply and delivery. •They are more cost-effective. •As vegetable oils, their derivatives and applications are fully acceptable to people for whom animal fats may be subjected to religious taboos. Lately MPOB has embarked on an extensive R&D programme in palm biomass utilization. It has been shown that oil palm biomass offers great potential for producing medium density fibre board (MDF), thermofoable plastic composites, pulp and paper, furniture etc. Putting knowledge in converting our resources into value added end products is consisitent with national government’s effort to transform the nation from a resource-based industry into a manufacturing-based industry so that the country will become a fully developed industrialized nation by the year 2000.