Wood vinegar wastewater (WVWW) is the main by-product of biomass pyrolysis process, which is more suitable to use anaerobic digestion (AD) to achieve energy recovery due to its large amount of organic matter. In this study, the up-flow anaerobic sludge bed (UASB) reactor was used to investigate the continuous anaerobic transformation of WVWW with gradient concentrations (0.3, 0.675, 1, 2, 3, 4, 5, 6, and 7 g COD/L). Then, the changes of microbial community, diversity index and functional gene were analyzed in detail. The results revealed that WVWW showed good AD performance in continuous fermentation. WVWW of organic loading rate (OLR) of >8.58 g COD/L•d showed severe inhibition on biodegradability and methane production, which is mainly due to the toxic substances as compared with the control group. The bacterial communities were dominated by phyla of Chloroflexi, Firmicutes, Proteobacteria, Acidobacteria, Synergistetes, and Actinobacteria. The gene abundances related to energy production, carbohydrate transport and metabolism were relatively high, which are mainly responsible for carbon forms conversion and carbohydrate degradation. This study will provide a basis for the screening and enrichment of functional bacteria and genes.