Breast milk has many beneficial properties and unusual characteristics including a unique fat component, termed milk fat globule membrane (MFGM). While breast milk yields important developmental benefits, there are situations where it is unavailable resulting in a need for formula feeding. Most formulas do not contain MFGM, but derive their lipids from vegetable sources, which differ greatly in size and composition. Here we tested the effects of MFGM supplementation on intestinal development and the microbiome as well as its potential to protect against Clostridium difficile induced colitis. The pup-in-a-cup model was used to deliver either control or MFGM supplemented formula to rats from 5 to 15 days of age; with mother's milk (MM) reared animals used as controls. While CTL formula yielded significant deficits in intestinal development as compared to MM littermates, addition of MFGM to formula restored intestinal growth, Paneth and goblet cell numbers, and tight junction protein patterns to that of MM pups. Moreover, the gut microbiota of MFGM and MM pups displayed greater similarities than CTL, and proved protective against C. difficile toxin induced inflammation. Our study thus demonstrates that addition of MFGM to formula promotes development of the intestinal epithelium and microbiome and protects against inflammation.