Dairy wastes in third-world countries are not adequately utilized to generate valuable by-products and trade them commercially for financial and environmental benefits. This paper focuses on such wastes and considers waste processing operations using the system dynamics (SD) simulation approach. Primary data used to build the SD model was collected from the farm records, a questionnaire, and a follow-up interview with management members. This model illustrates advancements in the dairy sector and equips a system dynamics framework with the necessary degree of validation to address the intricate challenge of waste management in dairy operations. The study deployed system dynamics methodology and replicated the real-life dairy farm processes in the Vensim simulation platform using 3 years of data. Five specific scenarios were experimented with to justify waste management processes (current operation, different allocations to bio-fertilizer, biogas, and raw dung), resulting in increased revenue and reduced landfill requirements. The ability to process waste was found to be limited by seasonality constraints. A comparison of scenarios enabled us to demonstrate that for a mid-sized dairy farm, the valuable by-products as a mix of bio-fertilizer and biogas lead to improved economic gains while protecting the environment. Thus, this work fills a crucial substantive and methodological gap in this research area. This study can assist academicians, policymakers, entrepreneurs, and responsible managers understand a solid dairy waste management system for emerging economies. The model also ignores variations in cattle types, such as milch cow, heifer (breedable), calves, and bull