Ambur, a town located on the banks of Palar River, is considered one of the most polluted areas in India and occupied by hundreds of tanneries and leather product units. The present study was designed to evaluate the toxic effect of discharged tannery effluent (TE) on model agricultural crops, ecofriendly microorganisms, and human blood cells. The phytotoxic effects of TE tested on Allium cepa and Lemna minor revealed inhibition of root growth and significant reduction in number of fronds, protein, and chlorophyll content. Moreover, TE induced chlorosis and tissue necrosis in Nostoc muscorum at low concentration (10%). TE has also negative impact on ecofriendly microorganisms, Bacillus thuringiensis, Rhizobium etli, and Aspergillus terreus which play an important role in the nutrition of plant growth. The genotoxicity of TE was investigated in human leukocytes which showed interference with normal mitotic division with subsequent cell lysis. It also intervened with the normal replication process and induced micronucleus formation in the healthy leukocyte. 5% concentration of TE has been revealed to be toxic to erythrocytes. From this study TE found in the Palar River of Ambur has adverse effects on all the three levels of organisms in ecosystem even at lower concentrations.