The studies arc undertaken to develop an effective anaerobic continuous digestion process for biogas generation from sugar industry wastewaters using actively digested sludge from a sewage plant, in three-phase fluidized bed bioreactor. Attempts are made to optimize hydraulic retention time (HRT), initial feed pH, feed temperature and flow rate of feed (organic loading rate) for maximum production of methane gas and maximum removal of chemical oxygen demand (COD) and biological oxygen demand (BOD) of sugar industry wastewaters. The optimum conditions for the system are: digestion time, 8 h; initial pH of feed, 7.5; feed temperature, 40 degrees C; feed flow rate, 14 L/min with maximum organic loading rate (OLR), 39.513 kg COD m(-3) h(-1). The organic loading rates (OLR) are calculated on the basis of COD inlet in the bioreactor at different flow rates. The maximum expansion of the bed is observed as 23.67 in at optimum feed flow rate of 14 L/min. The maximum methane gas concentration is 63.56% (v/v) of the total biogas generation at optimum process parameters. The maximum biogas yield rate is 0.835 m(3)/kg COD m(-3) h(-1) with maximum methane gas yield rate of 0.530 m(3)/kg COD m(-3) h(-1) (63.56% v/v) at optimum process parameters. The values for maximum reduction of COD and BOD are 76.82% (w/w) and 81.65% (w/w) with maximum OLR of 39.513 kg COD m(-3) h(-1) at optimum conditions.