Microfluidics is revolutionizing the production of microparticles and nanoparticles, offering precise control over dimensions and internal structure. This technology facilitates the creation of colloidal delivery systems capable of encapsulating and releasing nutraceuticals. Nutraceuticals, often derived from food-grade ingredients, can be used for developing functional foods. This review focuses on the principles and applications of microfluidic systems in crafting colloidal delivery systems for nutraceuticals. It explores the foundational principles behind the development of microfluidic devices for nutraceutical encapsulation and delivery. Additionally, it examines the prospects and challenges with using microfluidics for functional food development. Microfluidic systems can be employed to form emulsions, liposomes, microgels and microspheres, by manipulating minute volumes of fluids flowing within microchannels. This versatility can enhance the dispersibility, stability, and bioavailability of nutraceuticals. However, challenges as scaling up production, fabrication complexity, and microchannel clogging hinder the widespread application of microfluidic technologies. In conclusion, this review highlights the potential role of microfluidics in design and fabrication of nutraceutical delivery systems. At present, this technology is most suitable for exploring the role of specific delivery system features (such as particle size, composition and morphology) on the stability and bioavailability of nutraceuticals, rather than for large-scale production of nutraceutical delivery systems.