The dramatic increase in bio-oil production in Canada has resulted in millions of tonnes of different types of co-products: carinata meal and canola meal. Little research has been conducted to determine pelleting induced changes at different conditioning temperature and time on the metabolic characteristics of the proteins in co-products from bio-oil processing in dairy cattle. The objectives of this study were to investigate the effects of conditioning temperature (70, 80 and 90°C), time (50 and 75 s), and interaction (temperature × time) during the pelleting process on the metabolic characteristics of the proteins, feed milk value, the total truly absorbed protein supply (DVE), and degraded protein balance (DPB) to dairy cattle and to compare between unprocessed mash and pellets in true protein supply to small intestine of dairy cows. The DVE/OEB system was applied in determining metabolic characteristics of the proteins, feed milk value, DVE and DPB values. The data were analyzed with a randomized complete block design (RCBD) with a 3 × 2 factorial arrangement. Statistical analyses were performed through MIXED procedure of SAS 9.3. The results showed that the unprocessed co-product from bio-oil processing is a good source of the truly digested protein in small intestine (DVE: 170 g/kg DM) with DPB of 115 g/kg DM. It was unexpectedly found that the pelleting process under current conditions did not increased but reduced DVE and increased DPB values. Within pelleting processed treatments, there was no interaction (P = 0.64) between conditioning temperature and time on the metabolic characteristics of the proteins. However, increasing conditioning temperature tended to decrease DPB (P = 0.051) values of co-product pellets. Feed milk value of the co-products was reduced after pelleting process as well (3.4 vs. 3.0 kg milk per kg feed). In conclusion, pelleting with relative low temperature (70–90°C) decreased DVE, feed milk value, and increased DPB of co-products compared with raw co-products. Increasing conditioning temperature during pelleting tended to decrease the potential N loss of pelleted co-products.