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Introduction. Primary bile acids (PBAs) are produced and released into human gut as a result of cholesterol catabolism in the liver. A predominant PBA is chenodeoxycholic acid (CDCA), which in a recent study in our laboratory, showed significant excipient-stabilizing effects on microcapsules carrying insulinoma β-cells, in vitro, resulting in improved cell functions and insulin release, in the hyperglycemic state. Hence, this study aimed to investigate the applications of CDCA in bio-encapsulation and transplantation of primary healthy viable islets, preclinically, in type 1 diabetes. Methods. Healthy islets were harvested from balb/c mice, encapsulated in CDCA microcapsules, and transplanted into the epididymal tissues of 6 syngeneic diabetic mice, post diabetes confirmation. Pre-transplantation, the microcapsules' morphology, size, CDCA-deep layer distribution, and physical features such as swelling ratio and mechanical strength were analyzed. Post-transplantation, animals' weight, bile acids', and proinflammatory biomarkers' concentrations were analyzed. The control group was diabetic mice that were transplanted encapsulated islets (without PBA). Results and Conclusion. Islet encapsulation by PBA microcapsules did not compromise the microcapsules' morphology or features. Furthermore, the PBA-graft performed better in terms of glycemic control and resulted in modulation of the bile acid profile in the brain. This is suggestive that the improved glycemic control was mediated via brain-related effects. However, the improvement in graft insulin delivery and glycemic control was short-term. [ABSTRACT FROM AUTHOR]