Kinnow peel, a major by-product (30%-34%) of Kinnow processing, is a rich source of dietary phytochemicals, and possesses biochemical and pharmacological properties with positive health benefits. The present study used kinnow peel powder (KPP) at 0%, 1%, 2% & 3% (on flour basis) as a functional ingredient and observed its effect on functional, baking, textural, antioxidant and sensory properties of bread. KPP significantly (P < 0.05) reduced the final viscosity of blends, while increased the bake absorption (60.10%-67.01%) and reduced the bake loss (14.30-11.16 g) of bread. Higher moisture binding and fibre content of KPP also hinders the leavening capacity of the bread as a result of which loaf-specific volume decreased progressively, while increasing the bread crumb hardness (5.41-9.39 N). The presence of bioactive compounds in KPP increased the total phenolic (16.93-45.21 mg GAE 100 g(-1)), flavoniods (4.71-42.53 mg QE 100 g(-1)), carotenoid content (2.90-6.71 mg 100 g(-1)) of bread and enhance its antioxidant activities. Bread crumb with KPP exhibits increased lightness and yellowness value. Bread with 2% KPP presented better sensory properties that can be used to prepare acceptable bread. Principal component analysis also revealed bread with 2% KPP with better functional attributes.