Functionalization through microfluidization was applied as a prospective method for the production of fibrous structures from hazelnut skin, and which was used as a novel ingredient in a model low water activity bakery product. Although hazelnut skin was used in this study, other common agro by-products such as wheat bran, corn bran, citrus pulp, etc., could be also processed. Microfluidization led to the disintegration of large particles into flaky and fibrous structures of which entanglement and higher water holding capacity resulted in noticeably different texture and rheological properties. One major advantage of utilization of the functionalized fiber was production of cookies with less water activity at comparable moisture content with control samples. Furthermore, high pressure processing released some of the phenolic compounds which were previously trapped within the cellulosic structures led to cocoa like dark color. Incorporation of the novel fibers into cookie samples slowed down retrogradation rate during the storage period.