Cookies were developed with fenugreek seed extract and fenugreek seed powder (FSP) as an added-value food ingredient with wheat flour. Fenugreek seed extract were encapsulated using gum arabic. Their physical and sensory analysis was studied. Results showed significant (p<0.05) difference of physical properties between control and 1-4% FSP level and 1-2% encapsulated fenugreek seed extract level. Spread ratio was found highest for those cookies where substitution was made with encapsulated fenugreek seed extract.  Fracture strength was highest for 4% level of FSP, whereas encapsulated fenugreek seed extract levels showed average value of fracture strength. Sensory analysis report showed highest score for the cookies, where substitution was made with 1-2% encapsulated fenugreek seed extract, which was close to control, as compared to 1-4% FSP levels. It can be concluded that these desirable properties of  cookies contained with fenugreek seed extract suggested that fenugreek seed extract can be used further in the development of quality cookies. Fenugreek seed extract possessing lot of physiological health benefits like hypoglycemic effect, hypocholestrolemic effect, possessing antioxidant activity etc. and could have higher preference over the whole seed powder of fenugreek for development and acceptability of cookies.