Microencapsulation has been developed by the pharmaceutical industry as a means to control or modify the release of drug substances from drug delivery systems. In drug delivery systems microencapsulation is used to improve the bioavailability of drugs, control drug release kinetics, minimize drug side effects, and mask the bitter taste of drug substances. The application of microencapsulation has been extended to the food industry, typically for controlling the release of flavorings and the production of foods containing functional ingredients (e.g. probiotics and bioactive ingredients). Compared to the pharmaceutical industry, the food industry has lower profit margins and therefore the criteria in selecting a suitable microencapsulation technology are more stringent. The type of microcapsule (reservoir and matrix systems) produced and its resultant release properties are dependent on the microencapsulation technology, in addition to the physicochemical properties of the core and the shell materials. This review discusses the factors that affect the release of bioactive ingredients from microcapsules produced by different microencapsulation technologies. The key criteria in selecting a suitable microencapsulation technology are also discussed. Two of the most common physical microencapsulation technologies used in pharmaceutical processing, fluidized-bed coating, and extrusion-spheronization are explained to highlight how they might be adapted to the microencapsulation of functional bioactive ingredients in the food industry.