This study was conducted to determine the optimal inclusion of squash fruit and its effect on the processing, physical, chemical and sensory characteristics of frankfurters. Five frankfurter formulations were used as treatments. Treatment 1 has no squash fruit added and served as control while treatments 2, 3, 4 and 5 contained 5%, 7%, 10% and 15% squash fruit, respectively. The addition of squash fruit in frankfurters had no significant effect on the processing characteristics. There were no significant differences in the chemical properties among treatments except for moisture and ash content. The beta-carotene content increases with the increasing amount of squash fruit. Sensory evaluation showed treatment with 5% squash had the highest scores for flavor, juiciness and general acceptability, and the lowest score for off-flavor. On the other hand, treatment 5 had low scores for flavor and juiciness, lowest score in general acceptability and the highest score in off-flavor and tenderness. The production cost per kilogram of frankfurters decreases as the level of squash fruit supplementation increases.