A pilot-scale fluidised pellet bed (FPB) bioreactor, which combines chemical coagulation, biological degradation, particle pelletisation and separation in one unit, was applied for onsite wastewater treatment and reuse. As a result of rational use of inorganic coagulant and organic polymer and moderate mechanical agitation, spherical particles were generated in the upflow column and a well-fluidised bed was formed. With a continuous supply of dissolved oxygen through a recycling loop, an aerobic condition was kept in the bottom section of the FPB column. Under such conditions the pellets in the FPB column showed the following characteristics: (1) compact structure and high density; (2) rich in microorganisms; and (3) high MLSS and MLVSS concentrations. Therefore, the FPB bioreactor achieved more than 90% removal of SS, COD, BOD and TP from raw domestic wastewater within a total hydraulic retention time (HRT) of only about 30 minutes. It also showed nitrification and denitrification ability and the TN removal could be about 50% as the recycling ratio was increased to 1:1. The treated water quality is generally competitive with the secondary effluent from a conventional activated sludge process. With these advantages the FPB bioreactor is recommendable as a compact system for onsite wastewater treatment and reuse.