Rifaximin (RFX), a semi-synthetic antibiotic belonging to BCS class IV category, has been used in the treatment of traveler’s diarrhea. An attempt has been made to improve aqueous solubility of RFX in the presence of β-cyclodextrin (β-CD) and hydroxy propyl β-cyclodextrin (HP-β-CD) and control its release in the gut by enteric coating. The stoichiometric proportion of RFX and complexing agent’s β-CD and HP-β-CD were determined by phase solubility studies. RFX–β-CD and RFX–HP-β-CD were prepared in 1:2 ratio by solvent evaporation technique using rota-evaporator with yield of 78% and 84% respectively followed by their evaluation using different techniques such as saturation solubility, Fourier transform infrared, differential scanning calorimeter, powder X-ray diffractometer, in vitro antimicrobial activity. The saturation solubility of RFX had improved from 0.0736 mg/ml to 0.2354 mg/ml and 0.5681 mg/ml in presence of β-CD and HP-β-CD respectively resulting in an increased zone of inhibition in the later complex during antimicrobial studies. The RFX–HP-β-CD complex particles were coated with eudragit L 100 (EL 100) by spray drying technique. The 32 factorial design was applied to formulate the micro particles. All formulations exhibited pH dependant drug release. The % EE was 69% and the release of RFX was retarded by enteric coating in the optimized batch FB2. Therefore, it can be concluded that solubility of some BCS class IV drugs can be improved by β-CD complexation and release of such inclusion complexes can be retarded to increase the residence time of RFX in the gastrointestinal tract.