Ecotoxicological effects of the discharge of Nigerian petroleum refinery oily sludge on biological sentinels were examined. The ecotoxicological effects examined included acute toxicity tests on Nitrobacter sp., fresh water shrimp (Desmoscaris trispinosa) and brackish water shrimp (Palaemoneles africanus) from the aquatic environment. It also covered chronic toxicity tests on microbial nitrogen transformation activity in soil and the growth of the terrestrial fauna, earthworm (Apporectoda longa) in pristine soils spiked with predetermined concentrations of the sludge. Analysis of the Nigerian petroleum refinery oily sludge used in this study indicated that the sludge is slightly acidic with a high total petroleum hydrocarbon (TPH) content of 340,000 mg/kg made up mainly between 10-40 carbon unit compounds. The sludge reduced the growth of Nitrobacter sp. in aqueous medium and also caused chronic effect on microbial nitrogen transformation activity in soil because it exceeded the 25% inhibition limit for chemicals with the potential to cause chronic effects on soil microbial activities. Similarly, the sludge exhibited toxicity on fresh and brackish shrimp. The freshwater shrimp was however more affected with an LC 50 of 1097.375 ± 0.62 mg/kg when compared with an LC 50 of 1590. 37±0.92 mg/kg obtained for the brackish water shrimp. It also reduced the growth rate of the earthworm (A. longa) progressively as the sludge concentration increased.