The Korean pet food industry has recently experienced rapid growth, driven by an increase in pet-owning households and a shift in consumer preferences towards health-oriented and functional products. In particular, the growing trend of pet humanization has elevated consumer expectations for pet food and treats to meet the quality and nutritional standards of human food. As a result, the potential application of dairy products in pet food is gaining attention. This review examined the evolving pet ownership environment, changes in the domestic pet food market, and global trends in dairy-based pet products. Lactose-free milk, goat milk, whey protein, and Greek yogurt have been identified as promising ingredients, due to their benefits in improving digestibility, palatability, nutritional supplementation, and functionality. The importance of addressing potential risks such as lactose intolerance and allergic reactions has also been emphasized. Thus, this review aimed to provide basic foundational data for the development of functional dairy-based pet food products and to contribute to enhancing the industrial value of the pet food sector.