The stability, capacity, and solids destruction efficiency of single versus two-stage anaerobic digestion was studied in bench-scale reactors using combined waste activated and primary sludge. Laboratory staged mesophilic digesters showed an improved volatile solids and volatile suspended solids destruction efficiency over a single-stage system (at the same total solids retention time [SRT]) of approximately 3.2 and 5.8 percentage points, respectively. To quantify stability and capacity, a new digester monitoring method was introduced that measured the digester maximum acetate utilization capacity, V max,ac , and was used to investigate the potential for digester instability at different transient loadings. The ratio of the V max,ac value to the estimated acetate production rate for a given digester loading was termed the acetate capacity number (ACN). Values greater than 1.0 indicate excess acetate utilization capacity. The first stage of the laboratory two-stage mesophilic system (10-day SRT for each stage) had an ACN number of 1.3 compared with a value of 1.8 for the single-stage 20-day SRT digester. Thus, while a staged mesophilic system can improve solids destruction efficiency, it demonstrates a lower capacity for metabolizing highly variable loads. Water Environ. Res., 79, 488 (2007).