Containment systems and methods safely and permanently encapsulate a sharp portion of a sharp medical instrument (e.g. a hypodermic needle). The containment system includes a cap or other container formed of a durable and flexible material and having a rim defining an open end configured to receive the sharp portion therein and an adhesive disposed on an interior surface of the container. The method of use includes inserting the sharp medical instrument into the container, and compressing the sides of the container to permanently encapsulate the sharp portion of the medical instrument within the adhesive. The adhesive may be an adhesive tape and may be protected before use by a covering, which may be removed at the time of use by pulling a pull tab extending from an opening in the container.