SEC FORM 3

SEC Form 3

FORM 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

OMB APPROVAL

OMB Number:			3235-0104
Estimated average burden
hours per response:			0.5

1. Name and Address of Reporting Person^*

SMOLYANSKY EDWARD

(Last)

(First)

(Middle)

LIFEWAY FOODS INC.

6431 OAKTON ST.

(Street)

MORTON GROVE

60053

(City)

(State)

(Zip)

2. Date of Event Requiring Statement (Month/Day/Year)
03/15/2004

3. Issuer Name and Ticker or Trading Symbol
LIFEWAY FOODS INC [ LWAY ]

4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

	Director	10% Owner
X	Officer (give title below)	Other (specify below)
	Controller

5. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Beneficially Owned
1. Title of Security (Instr. 4)	2. Amount of Securities Beneficially Owned (Instr. 4)	3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	4. Nature of Indirect Beneficial Ownership (Instr. 5)
Common stock, no par value	111,098	D
Common stock, no par value	1,389,425⁽¹⁾	I	Inheritance⁽²⁾

Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 4)	2. Date Exercisable and Expiration Date (Month/Day/Year)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
1. Title of Derivative Security (Instr. 4)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	4. Conversion or Exercise Price of Derivative Security	5. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)

Explanation of Responses:

1. For reasons more fully set forth elsewhere in this report, Edward Smolyansky disclaims ownership of the 1,389,425 shares of the Issuer's common stock attributable to him under Section 16 of the Securities Exchange Act of 1934.

2. As discussed more fully elsewhere in this report, Edward had an interest in certain common stock of the Issuer pursuant to a will. Edward has disclaimed this interest.

Remarks:

Michael Smolyansky, founder and former CEO of the Issuer ("Michael") died on June 9, 2002. Ludmila Smolyansky, Edward's mother ("Ludmila"), is the executor of the Estate of Michael Smolyansky. After Michael's death, Edward Smolyansky ("Edward") had an indirect pecuniary interest (as defined in Rule 16a-1(a)(2)(ii) under the Securities Exchange Act of 1934) in one-third of the shares of common stock of the Issuer owned by his father, Michael pursuant to the terms of that certain Last Will and Testament of Michael, dated February 2, 1990 (the "Will") and attached as Exhibit 20.1 to the Schedule 13D filed by Edward on April 30, 2003. Edward On March 5, 2003, pursuant to the Illinois Probate Act and the Internal Revenue Code of the United States, Edward executed a Disclaimer (the "Disclaimer") wherein he disclaimed his interest in one-third of the Estate Shares 9the "Allocable Interest"). The Disclaimer was filed with the Probate Division of the Circuit Court of Cook County, Illinois on March 10, 2003. Pursuant to the Disclaimer, no Estate Shares have been distributed to Edward. Accordingly, Edward no longer has an indirect pecuniary interest in any of the Estate Shares and disclaims the indirect pecuniary interest in 1,389,425 of the Estate Shares attributable to him under Rule 16a-1(a)(2)(ii).

	Edward Smolyansky	03/22/2004
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 5 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.