Formation of aqueous two-phase (ATP) emulsions relies on the immiscibility of two (bio)polymeric phases. Herein, we report that hydrophobization of whey proteins via a pre-acetylation and succeeding acetylation/heating combined process makes solutions of whey protein isolate (WPI) immiscible with alginate solutions. Erythritol was also added at different concentrations (0, 52, 105, and 158 mg/g) into the hydrophobized WPI solution. Subsequently, emulsions at an alginate to WPI weight ratio of 0.1–0.9 were prepared. Erythritol supplementation facilitated emulsification and increased emulsion stability, so that at the erythritol concentration of 105 mg/g, the emulsion was stable for a minimum duration of 7 days. The droplet size evolved and reached to ≈5 μm during this period. The hydrophobized protein had a mean hydrodynamic diameter of 80 nm, ζ-potential of −39 mV, and intrinsic fluorescence emission peak of 335 nm. Erythritol addition did not influence any of the above-mentioned characteristics. However, the hydrophobized WPI solution changed from Newtonian to a more viscous and shear-thinning fluid by adding erythritol at concentrations ≥105 mg/g, due probably to the induction of interaction among protein particles. A diameter of 150 nm was calculated for the air-dried hydrophobized protein particles using atomic force microscopy images, supporting the assumption that exclusion of erythritol from the protein particles surface induced inter-particle interactions. Erythritol addition at 105 mg/g had a twofold larger influence on the surface tension of hydrophobized WPI compared to water. It decreased the surface tension of hydrophobized WPI to 45 mN/m after droplet ageing for 350 s.