Large volumes of untreated palm oil mill effluent (POME) pose threat to aquatic environment due to the presence of very high organic content. The present investigation involved two pilot-scale anaerobic expanded granular sludge bed (EGSB) reactors, continuously operated for 1 year to treat POME. Setting HRT at 9.8 d, the anaerobic EGSB reactors reduced COD from 71179 mg/L to 12341 mg/L and recycled half of sludge by a dissolved air flotation (DAF). The average effluent COD was 3587 mg/L with the consistent COD removal efficiency of 94.89%. Adding cationic polymer (PAM) dose of 30 mg/L to DAF unit and recycling its half of sludge caused granulation of anaerobic sludge. Bacilli and small coccid bacteria were the dominant microbial species of the reactor. The reactor produced 27.65 m(3) of biogas per m(3) of POME which was utilized for electricity generation.