The aim was to obtain alcohol-free, water-dispersible propolis powder from non-dewaxed propolis extract, with high levels of phenols, with either freeze-drying or spray-drying. Optimisation was performed with different wall materials, centrifugation settings and propolis:carrier ratios, and was carried out by monitoring the effect of one parameter at a time on the dependable variables. The powders obtained contained high phenol levels, which included known bioactive components, and also showed high dispersibility in cold water and high antioxidant activity. Furthermore, the propolis powders were stable in water for up to 24h, and the release of encapsulated phenols did not change across different environmental values, as pH 3–6. Differential scanning calorimetry showed that propolis interacts with and stabilises the carrier material (gum Arabic), also high pressure liquid chromatography showed that the profiles of the powders remained unchanged across all encapsulation techniques. This study demonstrates that the same propolis formulations can be fine-tuned to suit specific final applications and confirms that freeze-drying is a viable alternative to the more established spray-drying for encapsulation of propolis. This study also demonstrates that non-dewaxed propolis extract is a better alternative for encapsulation purposes, as no phenolic compounds are lost during its processing.