The article looks at the competitiveness of Polish dairy products on the international market, examining projections through 2020. Two separate scenarios are analyzed. The first scenario assumes liberalization on the international milk market, while the second scenario assumes no change from the current trade policy. The analysis of the competitiveness of dairy products was made on an ex-post basis (for the 2004-2010 period) as well as in ex-ante terms (for 2020). The projections for 2020 were calculated using a Common Agricultural Policy Regionalized Impact (CAPRI) partial equilibrium model. To assess the competitiveness of Polish dairy products on the international market, the authors used competitiveness indexes proposed by German economist Klaus Frohberg. The competitiveness of Polish dairy products was assessed on the basis of trade results projected for the European Union. Powdered milk was the most competitive Polish dairy product on the international market in the studied period, the authors say. The projections for this product for 2020 suggest that its price and production volume will increase. On the other hand, butter proved to be the least competitive Polish dairy product. Its net trade value and competitiveness indexes are expected to deteriorate. The article finds that market liberalization reduces the competitiveness of Polish dairy products on the international market compared with the no-change scenario. Both the net trade values and the competitiveness indexes tend to be lower under the assumption of market liberalization, the authors conclude.