Using a multivariate experimental design, optimal conditions for phytate degradation were found to be pH 4.8 and 57 °C in barley flour (cv. Blenheim) and pH 5.2 and 47 °C in a crude extracted phytase from barley. Three methods for measuring phytase activity in raw and hydrothermally processed barley were compared. Incubation at pH 5 and 55 °C for 60 min did not give significantly different results (p > 0.05), whereas incubation at pH 5 and 50 °C for 10, 20, 30, and 60 min gave significantly different results (p < 0.001) between methods. The change in microstructure of phytate globoids during hydrothermal processing showed that the degradation was highest in the scutellum cells and less in the aleurone layer.