BACKGROUND For the first time, a closed‐loop anaerobic osmotic membrane bioreactor–membrane distillation (AnOMBR‐MD) hybrid system integrated with periodic microfiltration (MF) extraction was investigated for simultaneous nutrient and energy recovery while maintaining high water quality for reuse. In addition, phosphorus (P) was recovered as a valuable material for agricultural purposes. RESULTS The AnOMBR‐MD system exhibited excellent nutrient (>99.9%) and organic removal (almost 100%) due to double‐layer filtration (FO and MD membrane). Moreover, higher methane production (0.24 L CH4/g COD) was achieved from the MF‐AnOMBR process to supply a heat source for MD during the draw solution recovery process to reduce energy consumption. The MF permeate can significantly reduce the scaling potential caused by PO43− ions in bulk solution and mitigate salt accumulation in the anaerobic reactor. The P from the MF permeate was effectively recovered with an efficacy of 60 mg L−1 when the solution pH was adjusted to 12. CONCLUSION The overall performance of the MF‐AnOMBR‐MD hybrid system using 1.5 mol L−1 MgSO4 as the draw solution demonstrates its potential application in wastewater treatment with high nutrient recovery in the closed‐loop system. Moreover, this system combined with MD in AnOMBR for draw solution recovery could achieve low energy consumption when its biogas production is utilized as heat source from the anaerobic system. © 2018 Society of Chemical Industry