Bifidobacterium bifidum F-35 was microencapsulated into whey protein microcapsules (WPMs) by a transglutaminase (TGase)-induced method after optimization of gelation conditions. The performance of these WPMs was compared with that produced by a spray drying method (WPMs-A). WPMs produced by the TGase-induced gelation method (WPMs-B) had larger and denser structures in morphological examinations. Native gel and SDS-PAGE analyses showed that most of the polymerization observed in WPMs-B was due to stable covalent crosslinks catalyzed by TGase. The degradation properties of these WPMs were investigated in simulated gastric juice (SGJ) with or without pepsin. In the presence of pepsin, WPMs-A degraded more quickly than did WPMs-B. Finally, survival rates of the microencapsulated cells in both WPMs were significantly better than that of free cells and varied with the microencapsulation method. However, WPMs-B produced by TGase-induced gelation could provide better protection for microencapsulated cells in low pH conditions and during 1 mo of storage at 4 °C or at ambient temperature.