Modern wastewater treatment plants are often inappropriate for communities in developing countries. Such communities lack the funding, resources and skilled labour required to implement, operate, and maintain these plants. This research was conducted to investigate and establish an appropriate wastewater treatment system for the district of Gunung Kidul, Indonesia. Due to its lack of water during the dry season, this district is considered one of the poorest areas in the nation. First, wastewater was stored in septic tank units for a retention time of 26 days. Anaerobic conditions occurred, resulting in an 80% reduction of initial COD. The retained sludge was well stabilized with great potential, if dewatered, for reuse as fertilizer. Consequently, supernatant was separated for experiments consisting of lab scale aerobic sand filtering unit. Through filtration, further removals of COD (about 30%) and pathogens were achieved. Rich in nitrogen, the resulting effluent could be used for irrigation and soil conditioning. With faecal sludge and also a mixture of septic sludge and food waste, the hydrolysis stage of anaerobic digestion was examined. This paper discusses the laboratory findings in Karlsruhe and the design and implementation of a treatment system in Glompong, Indonesia.