In order to establish a database necessary for the least-cost formulation of sausages with by-products using a computer, functionalities and compositions of pork by-products were analyzed. Pearson con-elation coefficients were derived from values obtained through the analysis and the possibility of acquiring the bind index from values of proximate analysis was considered. A study also was carried out to check if the quality of the sausage manufactured using the least-cost formulation reflected proper theoretical indices of funtionalitily. Chemical composition, emulsion capacity, emulsion efficiency, cohesiveness, salt-protein, bind index and water-holding capacity were lower for the least cost formulation than those of lean meal while emulsion stability, pH and total pigment were higher. Although some items showed significantly higher correlation with each other it was not possible. to derive the bind index from proximate analysis of by-products as it was for lean meats. The heart was the only by-product used in the sausage formulation by the least-cost formulation. As the level of hind constraint increased. the amount of picnic use increased, and use of heart and fat back decreased. The measured cohesiveness increased only when the bind constraint level was 0.19 while the measured hardness increased with the increase in the bind contraint. Pigment content was always above the minimum level.