Aerobic digestion is similar to the activated-sludge process. As the supply of available substrate is depleted, the microorganisms begin to consume their own phytoplasm to obtain energy for cell maintenance reactions. Cell tissue is oxidised aerobically to carbon dioxide, water and ammonia. The ammonia is subsequently oxidised to nitrate as digestion proceeds. In actuality only 75 to 80% of the cell tissue can be oxidised, the remaining 20 to 25% is composed of inert components and organic compounds that are not biodegradable. The biochemical changes in an aerobic digester can be described by the following equation (biomass: C₅H₇NO₂).

Aerobic digesters can be operated at ambient temperatures or at thermophilic conditions (55°C). Aerobic digestion is an exothermic process which can heat up the digester to 70°C without additional heating if the tank is isolated and the organic load is sufficient. Because supplemental heat is not provided, the process is called autothermal.

Compared to anaerobic digestion there are some advantages (+) and disadvantages(-):

+ lower BOD concentrations in supernatant liquor

+ recovery of more of the basic fertilizer values in the sludge

+ operation is relatively easy

+ lower capital costs

- high power cost for supplying the required oxygen

- digested solids have poorer mechanical dewatering characteristics

- no useful by product (methane) is recovered

To meet high requirements for pathogen reduction, retention times at 15°C and 20°C have to be 40 and 60 days, respectively. At thermophilic conditions 6-8 days are sufficient.