The objective of this study was to determine the effect of encapsulation on survival of probiotic Lactobacillus acidophilus ATCC 4356 (ATCC 4356) in yogurt and during artificial gastric digestion. Strain ATCC 4356 was added to yogurt either encapsulated in calcium alginate or in free form (unencapsulated) at levels of 8.26 and 9.47 log cfu/g, respectively, and the influence of alginate capsules (1.5 to 2.5 mm) on the sensorial characteristics of yogurts was investigated. The ATCC 4356 strain was introduced into an artificial gastric solution consisting of 0.08 N HCl (pH 1.5) containing 0.2% NaCl or into artificial bile juice consisting of 1.2% bile salts in de Man, Rogosa, and Sharpe broth to determine the stability of the probiotic bacteria. When incubated for 2 h in artificial gastric juice, the free ATCC 4356 did not survive (reduction of >7 log cfu/g). We observed, however, greater survival of encapsulated ATCC 4356, with a reduction of only 3 log cfu/g. Incubation in artificial bile juice (6 h) did not significantly affect the viability of free or encapsulated ATCC 4356. Moreover, statistically significant reductions (similar to 1 log cfu/g) of both free and encapsulated ATCC 4356 were observed during 4-wk refrigerated storage of yogurts. The addition of probiotic cultures in free or alginate-encapsulated form did not significantly affect appearance/color or flavor/odor of the yogurts. However, significant deficiencies were found in body/texture of yogurts containing encapsulated ATCC 4356. We concluded that incorporation of free and encapsulated probiotic bacteria did not substantially change the overall sensory properties of yogurts, and encapsulation in alginate using the extrusion method greatly enhanced the survival of probiotic bacteria against an artificial human gastric digestive system.