Avocado wastewater (AWW) is the largest by-product of cold pressed avocado oil. The aim of this study was to valorise AWW by converting it into spray dried powder for use as a lipid peroxidation inhibiting food preservative. To increase the powder yield of AWW, addition of carriers and spray drying parameters (temperature and feed flow rate) were optimised. The highest AWW powder yield was 49%, and was obtained using 5% whey protein concentrate (WPC), with a feed flow rate of 5.8 g/min and an inlet drying temperature of 160 °C. The liquid chromatography mass spectrophotometry (LC-MS) analysis showed that AWW encapsulated with WPC had the highest retention of α-tocopherol (181.6 mg/kg powder). AWW with 5% WPC was tested as a preservative in pork fat cooked at 180 °C for 15 min. Thiobarbaturic acid reactive substances (TBARS) assay showed that the effectiveness of AWW powder was comparable to commercial additives such as butylated hydroxytoluene (BHT), butylated hydroxyanisole (BHA), and sodium erythorbate (E316).