Generation of solid dye waste during wastewater purification especially in coagulation/precipitation steps and its detoxification is a major issue since it again leachate in the ground water from the landfills because of rains. The semisolid textile waste (sludge) showed 99 and 97% decolourization at flask and reactor scale within 72 h, respectively when treated with consortium ARBR (Azotobacter vinelandii MTCC 1241, Rhodobacter erythropholis MTCC 4688, B. megaterium NCIM 2054 and Rhizobium meliloti NCIM 2757). The decolourization rate of textile sludge majorly affects by the pH, temperature and moisture content of the sludge. At the optimum conditions of pH (6), temperature (30 oC) and moisture content (90%) the consortium showed maximum decolourization of 81, 84 and 97, respectively. A significant increase in the activities of oxidoreductase enzymes such as lignin peroxidase (5 fold), laccase (2.6 fold), veratryl alcohol oxidase (4.7 fold) and tyrosinase (2.9 fold) was observed; while azo reductase (-1.3 fold) showed a decrease in the activity during sludge treatment. In addition, a noteworthy reduction in the concentration of macromolecules N (45%), P (70%), K (50%) and C (63%), and microelements B (59%), Cu (50%), Fe (59%) and Mn (75%) were also observed after treatment with sludge bed reactor. Bio-transformed sludge showed less toxic effects on plants. The outcome from the sludge bed bioreactor (solid state bioreactor) was found to be more effective and can be used using sugar industry waste like sugarcane bagasse (SCB) for composting.