The purpose of this study was to evaluate the effect of carrier particle size on properties of dry powder and its effect on dry powder inhaler (DPI) performance. Commercial alpha-lactose-monohydrate, a commonly used carrier in DPI formulations, was carefully sieved to obtain different lactose size fractions, namely Lac A (90-125 mu m), Lac B (63-90 mu m). Lac C (45-63 mu m), Lac D (20-45 mu m), and Lac E (<20 mu m). The lactose samples were analysed in terms of size, shape, solid state, density, and flowability. Lactose particles were blended with budesonide (<5 mu m) powder to generate five different formulations. These formulations were then evaluated in terms of budesonide-lactose adhesion properties, drug content homogeneity, and in vitro aerosolisation performance. The results demonstrated that lactose samples with smaller particle volume mean diameter have higher amorphous lactose content, higher true density (linear, r(2) = 0.9932), higher surface smoothness (linear, r(2) = 0.8752), smaller angularity (linear, r(2) = 0.921), smaller bulk density, higher porosity (linear, r(2) = 0.914), poorer flowability, and higher specific surface area. In general, the smaller the lactose particles the smaller are the budesonide-lactose adhesion properties. Budesonide formulated with smaller lactose particles exhibited smaller aerodynamic diameter and higher amounts of budesonide were delivered to lower stages of the impactor indicating improved DPI aerosolisation performance. However, the use of lactose particles with smaller volume mean diameter had a detrimental effect on budesonide content homogeneity and caused an increase in the amounts of budesonide deposited on oropharyngeal region. Therefore, particle size of the lactose within dry powder inhaler formulations should be selected carefully. Accordingly, higher drug aerosolisation efficiency of lactose particles with smaller size may have to be balanced due to considerations of other disadvantages including poorer flowability, reduced formulation stability, higher potential side effects, and higher dose variability. Crown Copyright (C) 2012 Published by Elsevier B.V. All rights reserved.