Nanoparticle encapsulation has emerged as a relevant technology with the potential to revolutionize multiple fields, including medicine, food technology, cosmetics, and environmental monitoring. This review discusses the fundamental aspects of nanoparticle encapsulation, highlighting its benefits, such as enhanced solubility, stability, and bioavailability of phytochemicals. The data for this report were obtained via an extensive review of the peer-reviewed scientific literature. We reviewed various types of nanoparticles used in encapsulation, the efficacy of nanoparticle-encapsulated phytochemicals, and the challenges faced, including formulation complexity and regulatory hurdles. The review also considers current and future applications, providing examples of how advanced technologies such as artificial intelligence and novel manufacturing methods contribute to innovation in this field. As nanoparticle technology progresses, addressing safety and regulatory issues will be critical for its successful integration and commercialization. This review underscores the promising future of nanoparticle technology.