The microencapsulation of tea and herbal extracts is gaining considerable attention in the food industry, particularly in the production of instant powders. This review examines the application of spray-drying and freeze-drying technologies for the encapsulation of bioactive compounds, focusing on the role of wall materials. Over the past two decades, carbohydrate-based (e.g., maltodextrin), gum-based (e.g., gum Arabic), and protein-based (e.g., whey protein isolate) materials have been widely used due to their impact on sensory properties, stability, protection of bioactive compounds, and other critical attributes of encapsulated products. Despite their widespread use, these materials have distinct advantages and limitations, such as cost, availability, and compatibility with different extracts. This review provides a comprehensive analysis of their physical and chemical properties, examines alternative and emerging wall materials (e.g., beta-cyclodextrin, sodium alginate, and inulin), and highlights the potential of combining different materials to optimise encapsulation outcomes. It also identifies current research gaps and future directions to improve the efficacy and quality of encapsulated tea and herbal powders.