This study was carried out to determine the optimal inclusion rate of palm kernel cake (PKC) in diets for lactating goats based on intake, digestibility, feeding behavior, milk production and nitrogen metabolism. Twelve goats were used, eight Saanen and four Anglo Nubian, with a body weight of 46.0 ± 9.4 kg and 105 ± 5 days of lactation, distributed in a 4 × 4 Latin square design in triplicate. The diets were composed of increasing levels of PKC; 0, 80, 160 and 240 g kg−1 of dry matter (DM). The DM, crude protein, neutral detergent fiber and non-fibrous carbohydrates intakes decreased (p < 0.01) with the PKC inclusion. Milk production and milk protein decreased (p = 0.001), and milk production efficiency was not affected (p > 0.05) by the PKC inclusion. The ether extract intake varied quadratically (p < 0.01). Feeding and rumination efficiencies of dry matter and NDF were reduced (p < 0.001). The fat and total solids contents of the milk were influenced quadratically (p < 0.05). Nitrogen excretion (feces and milk), and retained nitrogen decreased (p < 0.001). Moderate use of up to 80 g kg−1 DM of PKC in the diet of lactating goats is recommended since at these levels milk production or body weight are significantly affected.