Since nitrification is the rate-limiting step in the biological nitrogen removal from wastewater, many studies have been conducted on the immobilization of nitrifying bacteria. A laboratory-scale investigation was conducted to examine the effectiveness of a continuous-flow airlift reactor (ALR) on the granulation of nitrifying sludge and the nitrification efficiency of the reactor after granulation. The results showed that the granular sludge began to appear on day 30 and matured in 75 days. The mature granules had an average diameter of 1.54 mm, settling velocity higher than 82.4 m h(-1) and specific gravity of 1.07. The granules cultured in the present study had aerobic ammonia oxidation activity of 13.3 mg NH4+-N (gVSS)(-1) day(-1) and anaerobic ammonium oxidation (ANAMMOX) activity of 3.22 mg NH4+-N (gVSS)(-1) day(-1), which demonstrated that the nitrifying granules possessed the potential to be used as seed sludge for ANAMMOX and CANON (completely autotrophic nitrogen-removal over nitrite) reactors. After granulation, the ALR exhibited an excellent nitrification performance. It had strong tolerance to influent NH4+-N of 1100 mg L-1. When operated at influent NH4+-N concentration of 546 mg L-1, the reactor could remove over 94.4% of ammonium even at a nitrogen loading rate (NLR) of 2.37 fm(-3) day(-1) with a short hydraulic retention time (HRT) of 5.4 h. With the influent NH4+-N concentration of 547 mg L-1, HRT 6.9 h and NLR of 1.90 kg m(-3) day(-1), superior effluent quality could be achieved robustly, with an effluent NH4+-N of less than 5 mg L-1, satisfying the national primary discharging standard of China (GB 8978-1996). (c) 2008 Elsevier B.V. All rights reserved.