The present study evaluates the effect of L-leucine concentration and operating parameters of a laboratory spray dryer on characteristics of trehalose dry powders, with the goal of optimizing production of these powders for inhaled drug delivery. Trehalose/L-leucine mixtures were spray dried from aqueous solution using a laboratory spray dryer. A factorial design of experiment (DoE) was undertaken and process parameters adjusted were: inlet temperature, gas flow rate, feed solution flow rate (pump setting), aspiration setting and L-leucine concentration. Resulting powders were characterised in terms of particle size, yield, residual moisture content, and glass transition temperature. Particle size was mainly influenced by gas flow rate, whereas product yield and residual moisture content were found to be primarily affected by inlet temperature and spray solution feed rate respectively. Interactions between a number of different process parameters were elucidated, as were relationships between different responses. The leucine mass ratio influenced the physical stability of powders against environmental humidity, and a high leucine concentration (30% w/w) protected amorphous trehalose from moisture induced crystallization. High weight ratio of leucine in the formulation, however, negatively impacted the aerosol performance. Thus, in terms of L-leucine inclusion in a formulation designed for pulmonary delivery, a balance needs to be found between physical stability and deposition characteristics.