Low-energy cost wastewater treatment is required to change its current energy-intensive status. Although promising, the direct anaerobic digestion of municipal wastewater treatment faces challenges such as low organic content and low temperature, which require further development. The hydrolysis-aerobic system investigated in this study utilized the two well-proven processes of hydrolysis and aerobic oxidation. These have the advantages of efficient COD removal and biodegradability improvement with limited energy cost due to their avoidance of aeration. A pilot-scale hydrolysis-aerobic system was built for performance evaluation with actual municipal wastewater as feed. Results indicated that as high as 39–47% COD removal was achieved with a maximum COD load of 1.10 kg/m3·d. The dominant bacteria phyla included Proteobacteria (36.0%), Planctomycetes (15.4%), Chloroflexi (9.7%), Bacteroidetes (7.7%), Firmicutes (4.4%), Acidobacteria (2.5%), Actinobacteria (1.8%) and Synergistetes (1.3%), while the dominant genera included Thauera (3.42%) and Dechloromonas (3.04%). The absence of methanogens indicates that the microbial community was perfectly retained in the hydrolysis stage instead of in the methane-producing stage.