It has been challenging to synthesize p-type SnOx (1 < x < 2) and engineer the electrical properties such as carrier density and mobility due to the narrow processing window and the localized oxygen 2p orbitals near the valence band. Herein, we report on the multifunctional encapsulation of p-SnOx to limit the surface adsorption of oxygen and selectively permeate hydrogen into the p-SnOx channel for thin-film transistor (TFT) applications. Time-of-flight secondary ion mass spectrometry (ToF-SIMS) measurements identified that ultrathin SiO2 as a multifunctional encapsulation layer effectively suppressed the oxygen adsorption on the back channel surface of p-SnOx and selectively diffused hydrogen across the entire thickness of the channel. Encapsulated p-SnOx-based TFTs demonstrated much enhanced channel conductance modulation in response to the gate bias applied, featuring higher on-state current and lower off-state current (on/off ratio > 103), field effect mobility of 3.41 cm2/(V s), and threshold voltages of ∼5-10 V. The fabricated devices show minimal deviations as small as ±6% in the TFT performance parameters, which demonstrates good reproducibility of the fabrication process. The relevance between the TFT performance and the effects of hydrogen permeation is discussed in regard to the intrinsic and extrinsic doping mechanisms. Density functional theory calculations reveal that hydrogen-related impurity complexes are in charge of the enhanced channel conductance with gate biases, which further supports the selective permeation of hydrogen through a thin SiO2 encapsulation.