Synthetic oily bilge water (OBW) treatment and subsequent production of biopolymer were studied by using a sequential batch reactor (SBR). The effect of various influencing parameters such as solids retention time (SRT), cycle time (CT), substrate concentration, pH level on the organic removal and synthesis of polyhydroxyalkanoates (PHA) was examined by novel soil bacteria isolated from hydrocarbon contaminated site near Karaikal port, India. The isolates were identified as Pseudomonas tuomuerensis and Pseudomonas nitroreducens using 16S rRNA. Sudan Black B staining was performed to visualize the presence of PHA. The experimental results showed that a decrease in substrate concentration to 5000 mg/L of soluble COD (CODs) showed maximum organic removal (81%) and maximum PHA yields of its cell dry mass (81%). The PHA yield was maximum at SRT of 5 d, pH = 7 and CT of 24 h. The produced PHA was characterized by using FTIR, XRD and SEM analysis.