A modulating bypass valve includes a valve housing defining a modulating fluid passageway and a bypassing fluid passageway through the valve housing. The valve also includes a throttle plate assembly that is inserted through the valve housing and has a rotating shaft on an axis that is generally perpendicular to the modulating fluid passageway and the bypassing fluid passageway. A modulating throttle plate is attached to the shaft and located within the modulating fluid passageway. A bypassing throttle plate is attached to the shaft and located within the bypassing fluid passageway. An actuator rotates the shaft.