Treatment and water reuse in decentralized systems is envisioned to play a greater role in our future urban water infrastructure due to growing populations and uncertainty in quality and quantity of traditional water resources. In this study, we utilized life-cycle assessment (LCA) to analyze the energy consumption and greenhouse gas (GHG) emissions of an operating Living Machine (LM) wetland treatment system that recycles wastewater in an office building. The study also assessed the performance of the local utility's centralized wastewater treatment plant, which was found to be significantly more efficient than the LM (79% less energy, 98% less GHG emissions per volume treated). To create a functionally equivalent comparison, the study developed a hypothetical scenario in which the same LM design flow is recycled via centralized infrastructure. This comparison revealed that the current LM has energy consumption advantages (8% less), and a theoretically improved LM design could have GHG advantages (24% less) over the centralized reuse system. The methodology in this study can be applied to other case studies and scenarios to identify conditions under which decentralized water reuse can lower GHG emissions and energy use compared to centralized water reuse when selecting alternative approaches to meet growing water demands.