Membraneless organelles formed by liquid-liquid phase separation of proteins or nucleic acids are involved in diverse biological processes in eukaryotes. However, such cellular compartments have yet to be discovered or created synthetically in prokaryotes. Here, we report the formation of liquid protein condensates inside the cells of prokaryotic Escherichia coli upon heterologous overexpression of intrinsically disordered proteins such as spider silk and resilin. In vitro reconstitution under conditions that mimic intracellular physiologically crowding environments of E. coli revealed that the condensates are formed via liquid-liquid phase separation. We also show functionalization of these condensates via targeted colocalization of cargo proteins to create functional membraneless compartments able to fluoresce and to catalyze biochemical reactions. The ability to form and functionalize membraneless compartments may serve as a versatile tool to develop artificial organelles with on-demand functions in prokaryotes for applications in synthetic biology.