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Mung bean is a well-known good source of protein. To increase its bioactivity, economic value, and nutritional content as a functional food and food additive, lactostatin (IIAEK), a cholesterol-lowering bioactive peptide, was engineered into mung bean 8Sα globulin, a major storage protein. The results showed that the mutated 8Sα globulin has a significant bile acid binding capacity (cholesterol-lowering activity) up to 47.25%. Moreover, superimposed mutant (Mut2) and wild-type (Wt) 3D protein structures showed a 93–97% identity, indicating that the mutant proteins are stable. Ultra-performance liquid chromatography(UPLC)-based assay showed similar retention time for wild-type and mutant protein samples. Both IIAEK peptide standard and Mut2 digest had comparable baseline peaks corresponding to the same molecular size based on the liquid chromatography-mass spectrometry (LC-MS) data. A 573.36-Da mass spectrum was seen in Mut2, which indicates that Mut2 8Sα globulin has been successfully mutated and digested to release the bioactive peptide, IIAEK. In vitro bile acid binding capacity showed that the 6-h Wt and 12-h engineered protein (Mut2) digests had the highest activity. Lastly, potential allergenicity was checked in the Allergen Database for Food Safety (ADFS) and the AllerBase database, and the IIAEK peptide matched the Bos d 5 epitopes. This study provides a strong foundation and basis for mung bean nutrition improvement, development of cholesterol-lowering food supplements, and protein engineering of other food proteins.