High lipid and high protein infant formula milk powders were stored at water activity of 0.11, 0.33 and 0.53 for up to fourteen weeks at 40 °C to investigate the effect of storage water activity on physicochemical properties and formation of volatiles to thereby recommend optimal storage water activity conditions. Water activity of the powders was determined during storage together with surface colour, glass transition temperature combined with dynamic headspace sampling followed by gas chromatography/mass spectrometry. The principal component analysis (PCA) showed that the optimal water activity for storage of high lipid infant formula milk powder, for which lipid oxidation was found to be the critical quality parameter, is a _w = 0.33 with lowest lipid oxidation, while for high protein infant formula milk powder, for which protein degradation was found to be the critical quality parameter, a _w = 0.11 is optimal to limit formation of Maillard reaction products.