Several processes have been suggested to protect lipids from bioactivity of the rumen microorganisms. The majority of experiments with conjugated linoleic acid (CLA) were conducted using calcium salts of CLA. The objectives of this study were to determine the effects of encapsulated CLA (E-CLA) that was supplemented during days 21 to 100 post partum (PP), on milk fat depression, recovery rate and performance parameters. Forty-two multiparous Israeli-Holstein cows were divided at day 21 PP into two treatment groups: (i) control – supplemented with 43 g/day per cow of calcium salts of fatty acids (FAs). (ii) E-CLA – supplemented with 50 g/day per cow of encapsulated lipid supplement providing 4.7 g/day per cow of trans-10, cis-12 CLA. Post-treatment cows were followed for recovery rate until 140 days PP. Dry matter intake (DMI) during the treatment period was reduced by 2.5%, and milk yield was enhanced by 4.5% in the E-CLA cows. Milk fat percentage and yield were reduced by 13% and 9%, respectively, in the E-CLA treatment as compared with the control. The energy-corrected milk output was 3.6% higher in the control group than in the E-CLA group. Yields of trans-10, cis-12 CLA isomer in milk was 2.13-fold higher in the E-CLA cows than in the controls. Full recovery to milk fat percentage of the control group occurred 4 to 5 weeks after cessation of the E-CLA supplementation. No differences between groups were observed in any fertility parameter that was tested. In conclusion, the E-CLA supplement decreased DMI, enhanced milk yield, and decreased energy output in milk, and was effective in depressing milk fat. Full recovery to the milk fat content, but not yield, of the control group in the E-CLA group was relatively slow and occurred 4 to 5 weeks after termination of the supplementation.