Sago, the tapioca starch is manufactured by over 800 small-scale units located in the Salem district, Tamil Nadu, India. During the processing of sago it generates huge quantities of biodegradable solid waste, as crushed tubers. In present study an attempt was made to convert these biodegradable solid sago tubers into value added compost using an exotic earthworm, Eudrilus eugeniae. The experiments were carried out in a plastic tray at various concentrations of sago-sludge (50% 75% and 100%) for a period of 90 days. During the vermicomposting, data were collected on life form (cocoon, non clitellates, clitellates) of earthworm and it was found to be high in 50% followed by 75% and 100% concentrations. Chemical analysis of worked substrates showed a step wise increase of nitrogen and phosphorus. The fold increase of phosphorus and nitrogen were found to be high for sago-sludge undergoing vermicomposting than the control. During the composting period the organic carbon decreased from its initial value of 58, 76 and 107 mg/kg to 21, 24 and 65 mg/kg for 50, 70 and 100%, respectively The microbial analysis showed that after 75 days of composting, their population stabilized and further increase in composting period did not increase their population size. The results indicate that 50% and 75% concentration of sludge mixed with bedding material was ideal for the vermicomposting.