Peptide asparaginyl ligases (PALs) hold significant potential in protein bioconjugation due to their excellent kinetic properties and broad substrate compatibility. However, realizing their full potential in biocatalytic applications requires precise control of their activity. Inspired by nature, we aimed to compartmentalize a representative PAL, OaAEP1-C247A, within protein containers to create artificial organelles with substrate sorting capability. Two encapsulation approaches were explored using engineered lumazine synthases (AaLS). The initial strategy involved tagging the PAL with a super-positively charged GFP(+36) for encapsulation into the super-negatively charged AaLS-13 variant, but it resulted in undesired truncation of the enzyme. The second approach involved genetic fusion of the OaAEP1-C247A with a circularly permutated AaLS variant (cpAaLS) and its co-production with AaLS-13, which successfully enabled compartmentalization of the PAL within a patch-work protein cage. Although the caged PAL retained its activity, it was significantly reduced compared to the free enzyme (∼30–40-fold), likely caused by issues related to OaAEP1-C247A stability and folding. Nevertheless, these findings demonstrated the feasibility of the AaLS encapsulation approach and encourage further optimization in the design of peptide-ligating artificial organelles in E. coli, aiming for a more effective and stable system for protein modifications.