Changes in the activities of antimicrobial, antitumor, and antioxidant properties of postbiotics (YCG) are related to changes in the composition of phenolic compounds. Antimicrobial activity was found to be highest in postbiotic (YCG-7) against P. aeruginosa, S. aureus, and E. faecalis with an MIC of 3.1 µg/mL. YCG-7 revealed the most cytotoxicity against LS-174T and PC-3 cell lines with an IC50 of 5.78 and 6.56 µg/mL, respectively. YCG-7 was far more effective for scavenging free radicals in the NO• and DPPH assays with a scavenging activity of 70.73% and 85.6%, respectively. YCG-7’s total phenolic acid content is up to eightfold higher compared with control. Escherichia coli Nissle 1917 retained high viable counts during refrigerated storage, particularly in YCG (>108 cells g−1) revealing a potential prebiotic activity of Cape gooseberry juice. EcN affected the phenolic profile of the YCG. Pyrogallol, p-coumaric acid, ellagic acid, 4-hydroxybenzoic acid, salicylic acid, gallic acid, vanillic acid, o-coumaric acid, caffeic acid, catechol, syringic acid, and rutin were the predominant phenolic compounds in YCG-7 or YCG-15. Chlorogenic, rosmarinic, cinnamic acid, naringin, and kaempferol were degraded by EcN in YCG-7 and YCG-15. The YCG had significantly higher sensory scores for appearance, smoothness, sourness, mouthfeel, and overall acceptance. These results provide the basis to target the functional benefits of YCG for further human health applications.