Functional Foods are the current demand of consumers and so, development of functional foods poses an enormous potential in the sector of food research. Functional foods provide specific health benefits due to specific functional phytocomponents. Conventional processing like steam-distillation, solvent extraction, pasteurization, canning, drying have limitations in extraction and recovery of functional phytocomponents in its natural form and also in retention of these components during development of food products. This chapter, therefore, highlights potential of non-thermal processing technology for development of functional foods. Principle of major non-thermal processing e.g. High hydrostatic pressure, Ultrasound, Pulse Electric field, Oscillating Magnetic field etc., their application in extraction and recovery of functional components from plant matrix and in retention of functional components during development of fruit and vegetable based, cereal based, milk based and dried format of functional foods are explored. Non-thermal processing technologies, operated with controlled key parameters are found to be superior compared to thermal process in development of functional foods.