Brown coals will continue to be important energy resources in the near future, but their high water contents, which sometimes exceed 50 wt%, and their low calorific values restrict their utilization. Development of an efficient treatment method for dewatering and upgrading is desired to utilize brown coals on a large scale. Hydrothermal treatment is believed to be a promising treatment method because it can not only remove water in liquid phase but also improve calorific value of brown coal. However, some organic compounds are inevitably leached out from the coal during the treatment to emit a huge amount of wastewater containing organic compounds in small concentration, which causes a loss of coal energy as well as a serious problem of wastewater treatment. In this paper, an Australian brown coal (Morwell) was hydrothermally treated for dewatering and upgrading at 250-300 degreesC. When treated at 300 degreesC, the water content decreased from 1.31 kg/kg on dry matter to 0.59 kg/kg on dry matter and the calorific value increased from 25.8 to 27.8 MJ/kg on dry matter, indicating that the hydrothermal treatment is really effective for dewatering and upgrading the brown coal. The reactivity to oxygen at low temperature was also reduced by the treatment, which will contribute to suppress the spontaneous combustion of the coal. On the other hand, the amount of organic compound dissolved in the recovered wastewater increased with increasing treatment temperature and it reached ca. 1.5% on carbon basis at 300 degreesC. The wastewater was treated using a novel Ni-supported carbon catalyst developed by the authors. The organic compounds in the wastewater were completely gasified at as low as 350 degreesC under 20 MPa at the liquid hourly space velocity of as large as 50, producing combustible gas rich in CH4 and H-2. The proposed hydrothermal gasification process was found not only to be efficient for wastewater treatment but also to be effective for energy recovery from wastewater. The gasification process combined with the hydrothermal treatment process, which is operated under the conditions close to those of the gasification, will be a new and effective brown coal pretreatment process. (C) 2003 Elsevier Ltd. All rights reserved.