This study was aimed to optimize mixtures of ashwagandha powder and giloy powder along with wheat flour for the production of sponge cake. Ashwagandha powder and giloy powder were applied 2 to 5% and 5 to 8%, and yogurt was used as fat-replacer 50%. Optimization of the formulation was based on the sensory evaluation obtained through 9-point Hedonic scale. The results revealed that sponge cake incorporated with 2% ashwagandha powder and 5% giloy powder, i.e. ashwagandha giloy fortified sponge cake (AGFSC-I) was most appreciated by the tasting panel members with overall acceptability. Protein (%), fat (%), carbohydrates (%), energy (%), TPC (mg GAE/100 mg), TFC (mg QE/100 mg), and IC50 (mg/ml) value decreased during the storage period of 5 days, i.e. from 15.25 ± 0.03 to 13.15 ± 0.10; 12.44 ± 0.04 to 12.2 ± 0.16; 33.62 ± 0.31 to 31.99 ± 0.008; 307.44 ± 1.03 to 290.36 ± 0.96; 14.82 ± 0.13 to 7.694 ± 0.10; 5.111 ± 0.36 to 3.823 ± 0.08; and 13.82 ± 0.10 to 8.807 ± 0.08 respectively. Novelty Statement: Wheat flour sponge cake was prepared with the incorporation of ashwagandha and giloy as AGsFSC. Yogurt was used in place of butter in order to prepare low-fat AGFSC. Shelf-life analysis was performed to study the stability of AGFSC for 5 days. © 2021 Wiley Periodicals LLC.