In the present study, the concept of 'environmental floors' in the multi-storeyed building is proposed, where separate treatment of greywater by gravity-governed stabilization tank and blackwater by underground Malaprabha digester of the DOSIWAM (Decentralized On-Site Integrated WAste Management) system is carried out. The study evaluates the feasibility of the non-mechanised DOSIWAM system by comparing it with the mechanised activated sludge process (ASP) with the life cycle and cost assessment (LCA and LCCA) method. The LCA was carried out with the SimaPro software using the impact 2002+ method. Both systems served a multi-storeyed (G + 30) building with 890 population equivalent. The LCA results reveal that the non-mechanised DOSIWAM system has three to six times reduced environmental impacts than the ASP system in almost all impact categories. Although DOSIWAMS' weaker removal efficiency dominates in the results of aquatic eutrophication and acidification impact, the latter comparative economical assessment showed to be the most cost-effective alternative due to reduced land use cost, O&M cost, and benefits achieved with energy recovery in the form of biogas. The electricity and chemical consumption in the operation phase caused the highest environmental impact for the ASP system, whereas the production of clinker and steel are responsible for a detrimental impact in the construction phase of the DOSIWAM system.