The demand for organic and functional food continues to increase yearly. Among the available functional foods, propolis is a bee product that has various beneficial properties, including antimicrobial, antioxidant, and anti-inflammatory activities. However, it generally is only available in ethanol solution, which has poor bioavailability, as it is relatively insoluble in water. The use of such ethanol extracts is often objectionable because of the alcohol content and because they have a strong and striking taste. Development of alternatives that can efficiently and safely increase solubility in water, and that meet organic production specifications, has been a challenge. To address these concerns, microcapsules were developed using spray-dryer technology from an emulsion based on EPP-AF® propolis and gum arabic (i-CAPS). These propolis-loaded microcapsules were characterized using FT-IR, SEM, TGA, HPLC, and spectrophotometric techniques, along with determination of antimicrobial, antioxidant, antitumor, anti-inflammatory, and antihypercholesterolemic activities, as well as permeability in in vitro models. The production system resulted in microcapsules with a spherical shape and an encapsulation efficiency of 93.7 ± 0.7%. They had IC50s of 2.654 ± 0.062 and 7.342 ± 0.058 µg/mL by FRAP and DPPH antioxidant methods, respectively. The EPP-AF® i-CAPS also had superior antimicrobial activity against Gram-positive bacteria. Antitumor activity was calculated based on the concentration that inhibited 50% of growth of AGS, Caco-2, and MCF-7 cell strains, giving results of 154.0 ± 1.0, 117 ± 1.0, and 271.0 ± 25 µg/mL, respectively. The microcapsule presentation reduced the permeation of cholesterol by 53.7%, demonstrating antihypercholesterolemic activity, and it improved the permeability of p-coumaric acid and artepillin C. The IC50 for NO production in RAW 264.7 cells was 59.0 ± 0.1 µg/mL. These findings demonstrate the potential of this new propolis product as a food and pharmaceutical ingredient, though additional studies are recommended to validate the safety of proposed dosages.