The first objective of this study was to characterize the chemical properties of three lots of whey protein hydrolysate (WPH) obtained from a commercial manufacturer. The degree of hydrolysis (DH) of WPH was between 13.82 and 15.35%, and was not significantly (p > 0.05) different between the batches. From MALDI-TOF, 10 to 13 different peptides were observed in the range of 2.5−5 kDa and 5−8 kDa, respectively. The second objective of the study was to evaluate the effectiveness of WPH as a binder in whey protein isolate (WPI) wet agglomeration. For this purpose, a 3 × 3 × 2 factorial design was conducted with pre-wet mass (60, 100, and 140 g), WPH concentration (15, 20, and 25%), and flow rate (4.0 and 5.6 mL·min−1) as independent variables. WPI agglomeration was carried out in a top-spray fluid bed granulator (Midi-Glatt, Binzen, Germany). Agglomerated WPI samples were stored at 25 °C and analyzed for moisture content (MC), water activity, relative dissolution index (RDI), and emulsifying capacity. Pre-wet mass, flow rate, and the WPH concentration had a significant (p < 0.05) effect on the MC. Moreover, all interactions among the main effects had also a significant (p < 0.05) effect on MC. High MC and water activity were observed for the treatments with a higher pre-wet volume and higher flow rate, which also resulted in clumping of the powders. The treatment with the 60 g pre-wet mass, 20% WPH concentration, and 5.6 mL·min−1 flow rate combination had the highest RDI among all the samples. In conclusion, WPH can be used as a potential alternative to soy lecithin in WPI wet agglomeration.