We show how an optical microcavity setup can create multiparticle entanglement in an ensemble of neutral atoms by means of quantum Zeno dynamics (QZD). Our setup combines an atom chip with a fibre Fabry-Perot (FFP) resonator and allows us to load an ensemble of Rb87 atoms into a single node of an intracavity dipole trap, coupling the atoms strongly and identically to the cavity light field. This enables us to perform a quantum non-destructive measurement of their collective state. We realise QZD by modifying the dynamics induced by MW radiation by means of frequent cavity measurements at optical frequency. This QZD is shown to create multiparticle entanglement in a fast, deterministic scheme. To analyse the created states, we reconstruct the symmetric part of the atomic density matrix from 2d measurements of the ensemble’s Husimi Q-distribution. We give a time-resolved account of the creation of states with a minimum of 3-11 entangled atoms and fidelity of up to 0.37 with respect to a W state of 36 atoms. We study the influence of measurement strength and of experimental imperfections and demonstrate that our experiments are well described by simple models with no free parameters. We also present work towards improved FFP cavities, adressing the problem of frequency splitting of polarisation eigenmodes in cavities made from two fibres microfabricated with a CO2 laser. We show that this effect depends on the symmetry of the microfabricated structures and demonstrate that it can be controlled both at the level of fabrication and when assembling a cavity.