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Anaerobic membrane bioreactors (AnMBRs) have become a new mature technology and entered into the wastewater market, but there are several challenges to be addressed for wide applications. In this review, we discuss challenges and potentials of AnMBRs focusing on wastewater treatment. Nitrogen and dissolved methane control, membrane fouling and its control, and membrane associated cost including energy consumption are main bottlenecks to facilitating AnMBR application in wastewater treatment. Accumulation of dissolved methane in AnMBR permeate decreases the benefit of methane energy and contributes to methane gas emissions to atmosphere. Separate control units for nitrogen and dissolved methane add system complexity and increase capital and operating and maintenance (O & M) costs in AnMBR-centered wastewater treatment. Alternatively, methane-based denitrification can be an ideal nitrogen control process due to simultaneous removal of nitrogen and dissolved methane. Membrane fouling and energy associated with membrane fouling control are major limitations, in addition to membrane cost. More efforts are required to decrease capital and O & M costs associated with the control of dissolved methane nitrogen and membrane fouling to facilitate AnMBRs for wastewater treatment. © 2020 Water Environment Federation • Practitioner points • AnMBRs can accelerate anaerobic wastewater treatment including dilute wastewater. • Nitrogen and dissolved methane control is detrimental for AnMBR application to wastewater treatment. • Membrane biofilm reactors using gas-permeable membranes are suitable for simultaneous nitrogen and dissolved methane control. • High capital and O & M costs from membranes are a major bottleneck to wide application of AnMBRs. • Dynamic membranes could be an option to reduce capital and O & M costs for AnMBRs.