The majority of known peptides with high bioactivity (BAPs) such as antihypertensive, antidiabetic, antioxidant, hypocholesterolemic, anti-inflammatory and antimicrobial actions, are short-chain sequences of less than ten amino acids. These short-chain BAPs of varying natural and synthetic origin must be bioaccessible to be capable of being adsorbed systemically upon oral administration to show their full range of bioactivity. However, in general, in vitro and in vivo studies have shown that gastrointestinal digestion reduces BAPs bioactivity unless they are protected from degradation by encapsulation. This review gives a critical analysis of short-chain BAP encapsulation and performance with regard to the oral delivery route. In particular, it focuses on short-chain BAPs with antihypertensive and antidiabetic activity and encapsulation methods via nanoparticles and microparticles. Also addressed are the different wall materials used to form these particles and their associated payloads and release kinetics, along with the current challenges and a perspective of the future applications of these systems.