In this research, the impact of active and passive aeration on the performance of a new two-phase composting process for biodegradation of storage tank oily sludge (STOS) was evaluated. The hyphenated method consisted of primary-stage composting (PSC) including three windrow piles and secondary-stage composting (SSC) including four in-vessel bioreactors. Various turning and aeration rates were tested in the PSC and SSC for 12 and 6 weeks, respectively. Results showed that the removal percentages of total petroleum hydrocarbons (TPH) in the PSC and SSC were in the range of 72.13-89.42 and 68.36-81.63%, respectively. An overall TPH removal of 90.07-94.23% reached through the two-stage system was higher than those of both the PSC and SSC alone. The turning and aeration rate of every 5 days and 11 min(-1) kg(-1) were, respectively, determined as optimal values. TPH was degradation fitted to the first-order kinetics based on the rate constants and half-lives of 0.114-0.183 d(-1) and 3.79-6.08 days for the PSC, and 0.191-0.296 d(-1) and 2.34-3.63 days for the SSC, respectively. The bacteria of Staphylococcus sp., Pseudomonas sp., Protests sp., and Bacillus sp. were isolated from the process. This study verified the effectiveness of the two-phase composting system in STOS bioremediation.