Flax seeds are a type of functional food, that offering numerous benefits due to omega-3 fatty acids and flaxseed gum (FSG). FSG is used as an emulsifier and gelling agent in food. During extraction of FSG at 30, 60, and 90°C, both gum and protein yields were observed to increase as temperature increased. However, the ratio of neutral-to-acidic sugar decreased as temperature increased from 30°C to 90°C. The FSG extracted at 90°C had the highest content of total phenols and lignans, resulting in the highest antioxidant activity. The emulsion composed of oil with FSG at a ratio of 0.25:1 exhibited the highest percentage of emulsion stability. The oxidation stability of microencapsulated oil was evaluated by assessing the peroxide value (PV), conjugated dienes (CD), conjugated trienes (CT), and thiobarbituric acid (TBA) during storage under accelerated conditions. The unencapsulated oil showed the highest increases in PV, CD, CT, and TBA compared to encapsulated oils. The encapsulated oil with FSG (0.25:1) had lower contents of PV, CD, CT, and TBA compared to oils with FSG (0.5:1). These results demonstrate the positive effect of using FSG as an ingredient in oil encapsulation for improving oil stability.