The steam is generally used as a medium for heating of milk during manufacture of various products. The operations of pasteurization and sterilization of milk is done by steam. The pasteurization of milk is usually done by steam which is generated by burning one or other form of fossil fuel. Therefore, to reduce dependency on fossil fuel, a system comprising solar water heater and shell and tube heat exchanger was developed for pasteurization of milk. This would be helpful in the heating of milk by replacing the consumption of fossils fuels. The present investigation is aimed to evaluate the performance of solar water heated shell and tube heat exchanger, to develop milk pasteurization system using solar heated water and to assess the chemical and microbial qualities of pasteurized milk prepared using solar heated water. The S&THE performance was evaluated considering solar water flow rates of 3, 5, and 7 l/min at 85oC and cold water flow rates at 0.5, 1.0 1.5 l/min at 35oC. The parameters like rate of heat transfer from hot water and to cold water, LMTD, overall heat transfer coefficient on the basis of inner tube and on the basis of outer tube and number of transfer units on the basis of inner tube (NTUi) and outer tube (NTUo) were calculated. The highest values for NTUi and NTUo were observed to be 2.42 and 12.27 at flow rate of hot water at 7 l/min and flow rate of cold water at 0.5 l/min. Therefore, this combination of flow rates of hot water and milk was subsequently utilized for pasteurization. The pasteurized milk had 0.15% acidity, 3.49% fat, 8.44% SNF and 11.93% TS. All the microbiological test findings found within the BIS standards specified for pasteurized milk.