With the purpose of developing an alternative set yogurt with high consumer acceptability, passion fruit juice, at levels that varied from 0 to 10%, was incorporated into set yogurt, and the effects on the fermentation kinetics, physicochemical properties, and functionality of set yogurt were evaluated. The results showed that the addition of passion fruit juice was simultaneously propitious for milk acidification in earlier fermentation stages and reduced the fermentation rate at later stages of fermentation. The phenolic compounds and pectin in passion fruit juice interacted with caseins to form soluble complexes, enhancing the gel strength of set yogurts by 7.5%. The aroma and flavor of the set yogurt was improved as well. However, with the addition of 10% passion fruit juice, the gel structure was destroyed, and the quality of the set yogurt was very degraded. More importantly, the addition of passion fruit juice increased the polyphenol content and significantly enhanced the antioxidant activity of the set yogurt. This investigation demonstrated the feasibility of fabricating passion fruit juice-enriched set yogurt and its superior quality compared with the corresponding normal product.