In the whole world today there has been a growing awareness of the damage caused to the environment by the haphazard use of chemicals, some of which are very poisonous and carcinogenic. The textile industry has been strongly criticised as being one of the world's worst lawbreakers in terms of pollution because it demands a large amount of water and chemicals. Although air, water, and noise pollution are created at every step of fabric treatment, the most problem-filled is fabric wet processing, in terms of the huge amount of water and goodly number of chemicals used in wet processing and on completion of the process, leftover dyes and chemicals together with water are discharged as effluents. As the amount of sludge created by wastewater treatment increases, effective reuse and safe disposal of sludge becomes most important. This chapter provides comprehensive information about the various methods and techniques in recycling textile effluents and sludge treatment process of textile effluents.