-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 CDLMmjlQQh9bq8seOLFa1n/f1bE9oBw6BxYolSy6IW18nfhGRX0rGb75tL1gQ2T9
 iBZLaekS/uzDQOKkv4m7VA==

<SEC-DOCUMENT>0001072613-05-001854.txt : 20050801
<SEC-HEADER>0001072613-05-001854.hdr.sgml : 20050801
<ACCEPTANCE-DATETIME>20050801165400
ACCESSION NUMBER:		0001072613-05-001854
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20050729
FILED AS OF DATE:		20050801
DATE AS OF CHANGE:		20050801

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LIFEWAY FOODS INC
		CENTRAL INDEX KEY:			0000814586
		STANDARD INDUSTRIAL CLASSIFICATION:	DAIRY PRODUCTS [2020]
		IRS NUMBER:				363442829
		STATE OF INCORPORATION:			IL
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		6431 W OAKTON
		CITY:			MORTON GROVE
		STATE:			IL
		ZIP:			60053
		BUSINESS PHONE:		7089671010

	MAIL ADDRESS:	
		STREET 1:		6431 W OAKTON
		CITY:			MORTON GROVE
		STATE:			IL
		ZIP:			60053

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			SMOLYANSKY LUDMILA
		CENTRAL INDEX KEY:			0001227848

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-17363
		FILM NUMBER:		05988964

	BUSINESS ADDRESS:	
		STREET 1:		C/O LIFE WAY FOODS
		STREET 2:		6431 W OAKTON STREET
		CITY:			MORTON GROVE
		STATE:			IL
		ZIP:			60053
		BUSINESS PHONE:		8479671010
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>pro_13656ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2005-07-29</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000814586</issuerCik>
        <issuerName>LIFEWAY FOODS INC</issuerName>
        <issuerTradingSymbol>LWAY</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001227848</rptOwnerCik>
            <rptOwnerName>SMOLYANSKY LUDMILA</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O LIFEWAY FOODS, INC.</rptOwnerStreet1>
            <rptOwnerStreet2>6431 W. OAKTON STREET</rptOwnerStreet2>
            <rptOwnerCity>MORTON GROVE</rptOwnerCity>
            <rptOwnerState>IL</rptOwnerState>
            <rptOwnerZipCode>60053</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common stock, no par value</value>
            </securityTitle>
            <transactionDate>
                <value>2005-07-29</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>I</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>1000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>17.30</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>3852216</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common stock, no par value</value>
            </securityTitle>
            <transactionDate>
                <value>2005-07-29</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>I</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>200</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>17.05</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>3852016</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Common stock, no par value</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>16000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>See Footnote</value>
                    <footnoteId id="F1"/>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
    </nonDerivativeTable>

    <footnotes>
        <footnote id="F1">These shares are held by the Smolyanski Family Foundation, of which Ludmila Smolyansky is a trustee.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>By: /s/ Ludmila Smolyansky</signatureName>
        <signatureDate>2005-08-01</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----