To understand process performance and microbial community structure in oxic-settling-anaerobic (OSA) sludge reduction process, an anoxic-OSA (A + OSA) system and a conventional anoxic-oxic (AO) system were operated for 200 days. Both systems were almost equally effective in the removal of COD and ammonium nitrogen, but A + OSA system showed higher nitrogen removal efficiency owing to denitrification and the release of soluble organic matters in the sludge holding tank (SHT). A + OSA process reduced sludge production by 30.4% with observed sludge yield of 0.179 gSS/gCOD. Pyrosequencing results revealed that although core populations were shared with highly functional organization, the relative abundance and stability of microbial communities in A + OSA system were higher than AO system. Classes Anaerolineae and Actinobacteria responsible for hydrolysis and fermentation of organic matters were enriched in SHT and played an important role in sludge reduction of A + OSA process. Specific comparison down to the genus level revealed the enrichment of anaerobic fermentative bacteria (Azospira, Propionivibrio and Sulfuritalea) and slow growers (Trichococcus) in A + OSA system. (C) 2015 Elsevier B.V. All rights reserved.