Climate changes and continuous population growth increase water demands that will not be met by traditional water resources, like surface and ground water. To handle increased water demand, treated municipal wastewater is offered to farmers for agricultural irrigation. This study aimed to enhance the effluent quality from worn-out sewage treatment facilities in rural villages, retreat effluent to meet water quality criteria for irrigation, and assess any health-related and environmental impacts from using retreated wastewater irrigation on crops and in soil. We developed the compact wastewater retreatment and reuse system (WRRS), equipped with filters, ultraviolet light, and bubble elements. A pilot greenhouse experiment was conducted to evaluate lettuce growth patterns and quantify the heavy metal concentration and pathogenic microorganisms on lettuce and in soil after irrigating with tap water, treated wastewater, and WRRS retreated wastewater. The purification performance of each WRRS component was also assessed. The study findings revealed that existing worn-out sewage treatment facilities in rural villages could meet the water quality criteria for treated effluent and also reuse retreated wastewater for crop growth and other miscellaneous agricultural purposes.