McDonald's Is Ditching Margarine for Butter The beleaguered fast food company will be using real butter in McMuffins and other menu items cooked with biscuits and bagels.

McDonald's has some good news for dairy farmers and bad news for the lactose intolerant.

The chain is changing the way it cooks items with English muffins (which are in its popular McMuffin line), biscuits and bagels to include real butter. Inside stores, some signs already advertise the nationwide switch.

Two sources said the rollout would occur once locations deplete the supply of liquid margarine.

McDonald's did not respond to CNBC's requests for comment.

One sign at a Manhattan location says, "We're proud to cook breakfast items on the grill with real butter and we toast our English Muffins, biscuits and bagels with real butter too."

The signs are meant to both highlight the "real dairy" addition and warn those who are not able to eat items made with milk products.

The move is just the latest in a series by the fast food giant aimed at tweaking the way it makes its food as it continues trying to turn around its struggling U.S. business. As part of the overhaul, McDonald's has said it would toast its buns longer, change how it sears and grills its beef, and increase the Quarter Pounder patty size.