Active pharmaceutical ingredient (API)-based ionic liquids (API-ILs) present an exciting new paradigm for the formulation of poorly water-soluble drugs. In this study, a model room temperature API-IL (1-butyl-3-methyl imidazolium ibuprofenate) was demonstrated to be not just highly soluble but fully miscible and hence have effectively unlimited solubility in water, compared to 0.021 mg mL solubility for the ibuprofen API. Solutions of the API-IL were found to be stable for up to 2 years, indicating that they have the potential to offer thermodynamic stability upon release, avoiding recrystallization issues that can limit the bioavailability of amorphous solid dispersions (ASDs) and some high-energy crystalline forms. The ibuprofen API-IL was successfully spray-dried into a polymer carrier in loadings of up to 75% w/w in order to transform it into a solid powder suitable for oral solid dosage (OSD) formulation. From modulated differential scanning calorimetry, hot-stage microscopy, powder X-ray diffraction, and attenuated total reflectance Fourier transform infrared spectroscopy measurements, the mechanism by which this high loading was achieved is based on the immiscibility between the polymer and API-IL, with the polymer encapsulating the phase-separated API-IL. Dissolution studies showed that solidification of the API-IL into microcapsules by spray drying in this manner had no detrimental effect on release characteristics. Failure to dissolve crystalline API forms into the polymer matrix eliminates the solubility enhancement of ASDs but not for highly soluble or fully miscible API-ILs. Furthermore, miscible API-IL/polymer dispersions at high loadings were found to possess less-favorable physical properties because of melting point depression, resulting, in some cases, in a failure to form a viable powder. As such, microencapsulated API-ILs at high loadings in immiscible or low-miscibility polymers that have solubility enhancement of the API-IL form, while providing solid powders for processing, represent a promising new platform for the formulation of poorly soluble compounds as OSDs.