This study deals with the decolorization of the commercially important azo dyes, Orange II (C.I. Acid Orange 7) and Reactive Black 3HN (C.I. Reactive Black 8) under anaerobic conditions in wastewater. Laboratory scale semicontinuous studies were conducted using simulated cotton dyeing wastewater at ambient temperatures (24-28 degreesC) by maintaining a HRT of 10 days. The dye concentration in wastewater was maintained at 100 mg/l. The reactors were operated for 58 days and Orange II and Black 3HN were easily decolorized under the experimental conditions employed. The performance of the bioreactors was evaluated by monitoring oxidation-reduction potential (ORP) in the reactor, color and Chemical oxygen demand (COD) removal. Color removal of >99% was achieved in both the dye-containing reactors. COD removals of up to 95%, 92% and 94% were achieved in control, orange- and black dye-containing reactors, respectively. Effect of dyes and salts present in textile wastewater on methanogenesis was evaluated based on maximum methane production and methanogenic activity. Based on the maximum methane production data, no inhibition of methanogenesis was observed for dye concentrations of up to 400 mg/l for both the dyes. However from the methanogenic activity data, it was observed that the black dye concentration of 400 mg/l seemed to cause inhibition of methanogenesis.