An aerobic microorganism with an ability to utilize phenol as sole carbon and energy source was isolated from phenol-contaminated wastewater samples. The isolate was identified as Bacillus amyloliquefaciens strain WJDB-1 based on morphological, physiological, and biochemical characteristics, and 16S rDNA sequence analysis. Strain WJDB-1 immobilized in alginate-chitosan-alginate (ACA) microcapsules could degrade 200 mg/l phenol completely within 36 h. The concentration of phenol was determined using differential pulse voltammetry (DPV) at glassy carbon electrode (GCE) with a linear relationship between peak current and phenol concentration ranging from 2.0 to 20.0 mg/l. Cells immobilized in ACA microcapsules were found to be superior to the free suspended ones in terms of improving the tolerance to the environmental loadings. The optimal conditions to prepare microcapsules for achieving higher phenol degradation rate were investigated by changing the concentrations of sodium alginate, calcium chloride, and chitosan. Furthermore, the efficiency of phenol degradation was optimized by adjusting various processing parameters, such as the number of microcapsules, pH value, temperature, and the initial concentration of phenol. This microorganism has the potential for the efficient treatment of organic pollutants in wastewater.