Oral administration of live probiotics along with prebiotics has been suggested with numerous beneficial effects for several conditions including certain infectious disorders, diarrheal illnesses, some inflammatory bowel diseases, and most recently, irritable bowel syndrome. Though, delivery of such viable bacteria to the host intestine is a major challenge, due to the poor survival of the ingested probiotic bacteria during the gastric transit, especially within the stomach where the pH is highly acidic. Although microencapsulation has been known as a promising approach for improving the viability of probiotics in the human digestive tract, the success rate is not satisfactory. For this reason, co-encapsulation of probiotics with probiotics has been practised as a novel alternative approach for further improvement of the oral delivery of viable probiotics toward their targeted release in the host intestine. This paper discusses the co-encapsulation technologies used for delivery of probiotics toward better stability and viability, as well the incorporation of co-encapsulated probiotics and prebiotics in functional/synbiotic dairy foods. The common encapsulation technologies (and the materials) used for this purpose, the stability and survival of co-encapsulated probiotics in the food, and the release behavior of the co-encapsulated probiotics in the gastrointestinal tract have also been explained. Most studies reported a significant improvement particularly in the viability of bacteria associated with the presence of prebiotics. Nevertheless, the previous research has mostly been carried out in the simulated digestion, meaning that future systematic research is to be carried out to investigate the efficacy of the co-encapsulation on the survival of the bacteria in the gut in vivo.