The granulation process was extensively examined using phenol as sole carbon source in a 2-L laboratory upflow anaerobic sludge blanket (UASB) reactor. The study was conducted mesophilically at 35 C. Anaerobically digested sludge was used as seed after a 14-day activation period with glucose feed. Massive initial granules were developed after 3 months of startup, grew at an accelerated pace for 6 months, then became fully grown. The granulation process can be broken into three phases: acclimation, granulation, and maturation. However, granulation with phenol proceeded more slowly than it did in UASB reactors fed with readily biodegradable carbohydrates studied previously. The granular sludge cultivated had a median diameter of 1.8 mm, phenol-degrading activity of 0.65 g chemical oxygen demand (COD)/g volatile suspended solids (VSS){sm_bullet}d, and a sludge volume index of 14 mL/g. Phenol COD removal efficiency of 86% was achieved when the reactor was operating at an influent phenol concentration of 1,260 mg/L (corresponding to 3,000 mg COD/L), hydraulic retention time of 12 hours, and volumetric loading rate of 6 g COD/L{sm_bullet}d. However, the lower-than-expected phenol COD removal efficiency could be attributed to inhibition by the high influent phenol concentration or loading. The batch test demonstrated that the sludge methanogenicmore » activity was reduced by 52 and 75% at phenol concentrations of 420 and 840 mg/L, respectively.« less