Holy basil essential oils (HBEO) can be used in many food applications due to antioxidant and antimicrobial attributes, but they are susceptible to degradation upon storage. Therefore, a protective system is required to extend their shelf life. HBEO was microencapsulated by coacervation using gelatin and the microcapsules were subsequently coated with stearic acid (1%, 2%, and 3%) in carboxymethyl cellulose emulsions. The results showed that HBEO contents decreased with increasing stearic acid concentrations from 76% to 59%. Fourier transform infrared spectroscopy analysis suggested that HBEO was stable during microencapsulation. After 3-month storage, changes in appearance were detected in all samples, especially the uncoated and 3% stearic acid-coated microcapsules. Additionally, the surface HBEO content increased significantly, consistent with a distinct increase in darkness and agglomeration. X-ray diffraction analysis revealed the physical change of microcapsules, attributed to the renaturation of gelatin and recrystallization of stearic acid. The antioxidant activity of both non-encapsulated and encapsulated HBEO after storage decreased significantly, except the microcapsule coated with 1% stearic acid (half maximal inhibitory concentration of 0.35 mg/mL), whereas the antimicrobial activity remained constant. The findings suggest that HBEO microcapsules coated with 1% stearic acid could serve as antioxidant and antimicrobial additives in food industries.