Natural compounds have been attracting huge attention because of their broad therapeutic properties with specificity in their action in human health care as functional foods, pharmaceuticals and nutraceuticals. However poor bioavailability and reduced bioactivity attributed to poor solubility and instability is the major drawback hindering the incorporation of these therapeutically potential molecules in novel drug delivery systems. Based on the findings of reported research investigations; complexation of poorly water soluble phytochemicals with cyclodextrins has emerged to be a promising approach to improve their aqueous solubility, stability, rate of dissolution and bioavailability. The present article summarizes the encapsulation of natural compounds ranging from various flavonoids, phenolic derivatives, coumestans to triterpenes, with cyclodextrin and their derivatives. Also the article highlights the method of complexation, complexation ability, drug solubility, stability, bioavailability and safety aspects of reported natural compounds. Additionally we present the glimpses of patents published in recent 10–15 years to highlight the significance of inclusion of phytochemicals in cyclodextrins. In patents narrated, improvement in stability and solubility of curcumin by complexation with alkyl ether derivative of gamma-cyclodextrin is claimed. Another patent mentioned, complexation of artemisinins with β-cyclodextrin, improved the stability and integrity of peroxide part of artemisinins for long period. On the other hand the complex of dihydromyricetin with γ-CD has shown improved solubility, stability and bioavailability. Thus it can be concluded that phytochemicals have multiple biological activities with broader safety index and improvement of their solubility will be truly beneficial to aid their effective delivery in healthcare.