Extrusion of foods is an emerging technology for the food industries to process and market a large number of products of varying size, shape, texture, and taste. Extrusion cooking technology has led to production of wide variety of products like pasta, breakfast cereals, bread crumbs, biscuits, crackers, croutons, baby foods, snack foods, confectionery items, chewing gum, texturized vegetable protein (TVP), modified starch, pet foods, dried soups, dry beverage mixes etc. The functional properties of extruded foods plays an important role for their acceptability which include water absorption, water solubility, oil absorption indexes, expansion index, bulk density and viscosity of the dough. The aim of this review is to give the detailed outlines about the potential of extrusion technology in development of different types of products and the role of extrusion-operating conditions and their effect on product development resulting in quality changes i.e physical, chemical, and nutritional, experienced during the extrusion process.