Watermelons are generally consumed fresh, but their rind is disposed of as waste. In the present study, jam variants of watermelon (cv. Sugar Baby) were prepared with rind and pulp. Jam variants were inoculated with chitosan-coated calcium alginate beads with prebiotic inulin microencapsulating probiotic Lactobacillus rhamnosus (ATCC 7469) and Lactobacillus casei (ATCC 393). Micro-encapsulated probiotics survived better in simulated intestinal juices than in gastric juices. During ninety days of storage, jam variants’ physicochemical, sensory and microbial properties were assessed. Micro-encapsulated probiotics had a non-significant effect on the physico-chemical characteristics of watermelon jam variants during storage. In the sensory analysis of watermelon jam variants, jam having 50% endocarp and 50% rind was most accepted. A probiotic count of 107 colony forming unit per gram was observed in the rind jam variant after ninety days of storage, and no coliform count was observed. Present work implies that a novel synbiotic (probiotic with prebiotic) jam could be prepared using watermelon rind.