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Microbial populations within the rhizosphere have been considered as prosperous repositories with respect to bioremediation aptitude. Among various environmental contaminants, effluent from textile industries holds a huge amount of noxious colored materials having high chemical oxygen demand concentrations causing ecological disturbances. The study was aimed to explore the promising mycobiome of rhizospheric soil for the degradation of azo dyes to develop an efficient system for the exclusion of toxic recalcitrants. An effluent sample from the textile industry and soil samples from the rhizospheric region of Musa acuminata and Azadirachta indica were screened for indigenous fungi to decolorize Congo red, a carcinogenic diazo dye, particularly known for its health hazards to the community. To develop a bio-treatment process, Aspergillus terreus QMS-1 was immobilized on pieces of Luffa cylindrica and exploited in stirred tank bioreactor under aerobic and optimized environment. Quantitative estimation of Congo red decolorization was carried out using UV-Visible spectrophotometer. The effects of fungal immobilization and biosorption on the native structure of Luffa cylindrica were evaluated using a scanning electron microscope. A. terreus QMS-1 can remove (92%) of the dye at 100 ppm within 24 h in the presence of 1% glucose and 1% ammonium sulphate at pH 5.0. The operation of the bioreactor in a continuous flow for 12 h with 100 ppm of Congo red dye in simulated textile effluent resulted in 97% decolorization. The stirred tank bioreactor was found to be a dynamic, well maintained, no sludge producing approach for the treatment of textile effluents by A. terreus QMS-1 of the significant potential for decolorization of Congo red. Microbial populations within the rhizosphere have been considered as prosperous repositories with respect to bioremediation aptitude. Among various environmental contaminants, effluent from textile industries holds a huge amount of noxious colored materials having high chemical oxygen demand concentrations causing ecological disturbances. The study was aimed to explore the promising mycobiome of rhizospheric soil for the degradation of azo dyes to develop an efficient system for the exclusion of toxic recalcitrants. An effluent sample from the textile industry and soil samples from the rhizospheric region of Musa acuminata and Azadirachta indica were screened for indigenous fungi to decolorize Congo red, a carcinogenic diazo dye, particularly known for its health hazards to the community. To develop a bio-treatment process, Aspergillus terreus QMS-1 was immobilized on pieces of Luffa cylindrica and exploited in stirred tank bioreactor under aerobic and optimized environment. Quantitative estimation of Congo red decolorization was carried out using UV-Visible spectrophotometer. The effects of fungal immobilization and biosorption on the native structure of Luffa cylindrica were evaluated using a scanning electron microscope. A. terreus QMS-1 can remove (92%) of the dye at 100 ppm within 24 h in the presence of 1% glucose and 1% ammonium sulphate at pH 5.0. The operation of the bioreactor in a continuous flow for 12 h with 100 ppm of Congo red dye in simulated textile effluent resulted in 97% decolorization. The stirred tank bioreactor was found to be a dynamic, well maintained, no sludge producing approach for the treatment of textile effluents by A. terreus QMS-1 of the significant potential for decolorization of Congo red.