Addition of 4% UDCA to a formulation system consisting of 1.8% SA, 1% PLO, 1% PSS, and 2% PAA enhanced cell viability post-microencapsulation and resulted in a more stable formulation with enhanced encapsulated β-cell metabolism, bioenergetics, and biological activity with reduced inflammation. This suggests potential application of UDCA, when combined with SA, PLO, PSS, and PAA, in β-cell microencapsulation and diabetes treatment. © 2016 American Institute of Chemical Engineers Biotechnol. Prog., 32:501-509, 2016.