Fenugreek seeds are a rich source of bioactive compounds, such as diosgenin, which is one of the most crucial steroidal sapogenins emerging in the field with its spectacular health benefits. Plant-based diosgenin is bitter in taste and has remarkably low consumption levels, making it unable to fulfil the role of improving health benefits. Diosgenin is spray dried to mask bitterness and astringent flavors with two different wall materials, such as maltodextrin (MD) and whey protein concentrate (WPC), separately. The spray-drying condition of the selected optimization process was inlet air temperature (IAT 150–170 °C), feed flow rate (FFR 300–500 mL/h), and carrier agent concentration (CAC 10–20%). The optimization of the process variable was conducted for producing optimized encapsulated diosgenin powder (EDP) with both MD and WPC. The selected parameters, such as yield, encapsulation efficiency, moisture content, antioxidant activity, hygroscopicity, and solubility, are investigated in this current work. Based on the experimental results, the significant R2 values depict the model fitting to the responses. EDP revealed an optimization condition at 170 °C IAT, 500 mL/h FFR, and 20% CAC for MD and WPC. The highest responses were observed with WPC-EDP, such as yield at 82.25%, encapsulation efficiency at 88.60%, antioxidant activity at 53.95%, and hygroscopicity at 12.64%. MD-EDP revealed higher solubility at 96.64% and moisture content at 2.58%. EDP was studied using micrographs and diffractograms for the optimized samples, which revealed a smooth and dented surface with an amorphous nature for MD-EDP and WPC-EDP, respectively. EDP exhibited acceptable powder properties with regard to fulfilling the set purpose. EDP can be a better potential ingredient in different food matrices to act as a delivery vehicle for various health aliments.