The world’s population of 7.2 billion is projected to increase and reach 9.6 billion by 2050. FAO-predicted demand for food, fuel and fibre will thus increase 60% by the year 2050. Demand for beef and milk will increase significantly, and create global concern over the level of feed required to meet the projected levels of demand. Indonesia is the fourth largest populated country in the world with almost 240 million people in 2010 and a predicted population of about 320 million in 2050. The high population, together with economic growth and increased public demand for high quality protein sources such as beef and milk will result in a significant increase in demand for these food products. Increasing livestock and dairy production to secure food availability to feed the population is a high national priority. Need for food, feed and fuel, along with factors including climate change and massive land clearance for housing and industries, have encouraged Indonesia to improve the competitiveness and efficiency of its livestock and dairy production systems. Recent public awareness of ethical and environmental issues in animal production means these matters require greater attention to avoid public distrust in these industries. As feed and feeding contribute to more than 70% of the cost of livestock or dairy production, utilising alternative cheaper feeds which do not compete with food is a commercial necessity. Fortunately, there are by-products of agro-industries in Indonesia that can be used as alternative feeds: for example, cassava meal, rice straw, copra meal and palm oil byproducts such as palm kernel cake and palm fronds. The nutritive value of these by-products can be improved by physical or biological treatment. Among these, palm oil by-products have the highest potential as feed alternatives because Indonesia is one of the largest palm oil producing countries in the world. Consequently, integrating livestock, dairy and palm oil plantation systems is seen as a preferable way forward to deliver better efficiency and zero-waste agricultural systems and add more value for the local communities. Also grazing management under palm oil plantations may improve the cost-efficiency of cattle breeding systems.