Considering limited success in target-hitting discharge from alcohol industry, our attention was directed toward a recycling use of distillery spentwash (DS) in cassava bioethanol production by using a two-stage up-flow anaerobic sludge blanket bioremediation (TS-UASBB). With the TS-UASBB, SO42-, COD, N and P in the effluent from the DS degraded significantly and their concentrations were kept at 0.2 g.L-1, 2.0 g.L-1, 1.0 g.L-1 and 15 mg.L-1, respectively, in 13 batch processes for water-recycled ethanol fermentation. With the effluent used directly as dilution water, no heat-resistant bacteria were found alive. The thirteen-batch ethanol production individually achieved 10% after 48 h fermentation. The starch utilization ratio and total sugar consumption were 90% and 99.5%, respectively. The novel water-recycled bioethanol production process with ethanol fermentation and TS-UASBB has a considerable potential in other starchy and cellulosic ethanol production.