An increased environmental awareness has led to new trends in food industry, which are reflected in intensive studies on exploitation of fruit processing byproducts. Additionally, consumers' tendency to a healthy lifestyle has initiated the development of diverse functional food products. High amounts of by-products, such as peels, seeds, and stones, are discarded during fruit processing. It represents a problem both from the environmental and the economic point of view. On the other hand, the resulting residues are potential sources of numerous bioactive compounds. Therefore, fruit processing by-products such as substrates for the extraction of phenolic compounds, natural pigments, dietary fibers, protein isolates and oils attract great interest. These extracts have a great potential for the development of dietary supplements and new functional food products with beneficial health effects. However, bioactive compounds are susceptible to degradation, which represents a critical factor for their successful incorporation into food products. In this regard, the main challenge is to ensure the stability of bioactive compounds during processing, storage and in the gastrointestinal tract, i.e. to preserve their bioactivity and bioavailability. This challenge could be accomplished by the use of encapsulation. Namely, the formation of a physical barrier between an active compound and its surrounding is an effective way of protection. The present paper indicates the potential of by-products originating from the processing of apples, grapes, plums, raspberries and sour cherries as sources of bioactive compounds. It also points out the benefits that could be achieved by the encapsulation of bioactive compounds extracted from fruit processing by-products in order to develop new functional food products.