A novel technology combining biochemical degradation and membrane separations has been proposed for the treatment of prehydrolysis liquor (PHL), a major waste effluent of rayon grade paper mills in India. The article addresses the significance, advantages, limitations and industrial viability of the technology and offers an alternate route to an otherwise conventional chemical method currently adopted in treating the PHL. In the present work, the effluent constituting primarily reducing sugars was first subjected to biological treatment with Torula utilis. The products (yeast) formed due to microbial fermentation as well as some unreacted constituents were then removed employing ultrafiltration (UF) and reverse osmosis (RO). The biological treatment followed by these membrane processes thus resulted in a clear liquid with negligible chemical oxygen demand (COD) and less than 0.9 mg/l of total reducing sugar (TRS). A series of experiments carried out suggested suitable range of operating conditions, such as dilution ratio of effluent liquor (1: 1), growth rate of yeast formation (similar to 5 days) and quantity of culture (15%), apart from other chosen conditions, for sustaining the maximum growth of yeast. A relatively larger MWCO size membrane (similar to 100 000) was found to be advantageous during UF for the removal of yeast and other constituents. The UF permeate when subjected to RO (using thin-film composite membranes) resulted in the removal of practically remaining amount of TRS. A pressure of around 2.1 MPa was found to be sufficient to carry out RO separation, which in absence of biological treatment followed by UF, would increase the operating pressure to a much higher value. Thus a substantial reduction in operating pressure of RO could be achieved by this combined process. (C) 2005 Elsevier B.V. All rights reserved.