To reduce bitterness of soy protein hydrolyates, chemical modification of lysine was investigated. Isolated soy protein (ISP) was treated with N-acetylimidazole for acetylation of lysine and tyrosine. O-acetyl tyrosine was deacetylated at pH 11. The lysine-acetylated soy protein and control protein were hydrolyzed by bromelain to the same degree of hydrolysis (10%), and then bitterness of each protein hydrolysate was evaluated. Sensory analyses indicated that bitterness of hydrolysates of lysine-acetylated ISP decreased in comparison with hydrolysates of control ISP (p<0.005). Surface hydrophobicity of hydrolysates of lysine-acetylated ISP slightly increased, and they had fewer lysine residues at the C-terminal region than hydrolysates of control ISP.