Characteristics of liposomal encapsulated ethanolic coconut husk extract (LE‐ECHE) as influenced by different stabilising agents (SA) were investigated. LE‐ECHE was prepared using four liposome formulations including soy phosphatidylcholine (SPC) alone and SPC mixed with cholesterol (CHL), tween 80 (TWE) or glycerol (GLY) at a ratio of 4 : 1 as lipid phase (LP) at a concentration of 60 µmol mL−1. Particle size, zeta potential, poly‐dispersity index, encapsulation efficiency (EE) and suspension stability (SS) of LE‐ECHE samples were markedly influenced by SA (P < 0.05). Antioxidant activity of ECHE was retained after entrapment in liposome, regardless of SA used. However, SA affected the antioxidant activities of LE‐ECHE differently. Antibacterial properties of ECHE were enhanced after encapsulation in liposome, irrespective of SA. Therefore, liposome with glycerol or cholesterol could serve as a delivery based system for improving the antibacterial properties with high stability, while lowering the undesirable colour of ECHE.