The aim of this work was to study the suitability of camel milk for the production of dairy products (especially yogurt) by lactic acid fermentation. Camel milk was recently recommended as a food alternative to people with allergenic to bovine milk. Consumers and manufacturers have shown great interests about camel milk and its products. Manufacturing camel milk and its product especially set yogurt and cheeses are experiencing several challenges. Until recently, production of yogurt and natural cheese from camel milk is not affordable like cow milk. Several reasons have been proposed for this issue including camel milk proteins and lactic acid bacteria (LAB). Indigenous LAB isolated from camel milk play significant role in improving yogurt and cheese production and thus improving dairy industry. Moreover, these indigenous LAB are expected to have probiotic characteristics (anti-hypertensive, anti-oxidant, anti-cancer, immunomodulatory effects, anti-diabetics). In this study, Camel milk samples were collected from local farms in different regions of Oman. The pH, total solids, titratable acidity, lactose and fat contents as well as moisture were measured. Sixty-three strains of LAB were isolated. Twenty were selected according to their morphological and biochemical characteristics for further investigation. The strains were tested for their ability to tolerate acidic conditions, biomass production, acidification activity, antibiotic resistance, antimicrobial activity, lipolytic activity, proteolytic activity, exopolysaccharide, lactose utilization, autoaggregation and hydrophobicity. All strains showed different degrees of activities with each characteristic. Hence, all were used to produce yogurt using camel and cow milk. Camel milk was formulated by addition of 2.5% skim milk and 0.6% stabilizer (starch or gelatin). The results showed that camel yogurts had soft and fragile structure, unlike cow yogurts which were more similar to commercial cow yogurt. The consumer performance was conducted using a hedonic scale for both camel and cow yogurts. Cow yogurts had better overall acceptability than camel yogurts in term of color, taste, aroma and texture. Among the different concentrations of alginate used, proved that 1% alginate improved the texture and viscosity of yogurt as well as increased the acidity in comparison with 5%.