This study compares the performance of a pilot-scale Two Stages Up-flow Anaerobic Sludge Blanket (TSUASB) to that of Activated Sludge Configuration (ASC) for the treatment of municipal sewage. The two examined systems were operated at high hydraulic loading rates (the Hydraulic Retention Time (HRT) was reduced from 4.5 to 2.25 and then to 1.5hr). Both systems were operated in parallel with the same influent characteristics. The study was conducted at Al-Qenayat Waste Water Treatment Plant (WWTP) located in Zagazig, Egypt, which revealed that the BOD removal efficiency of the TSUASB was in the range of 75-84% compared to 86-94% of the ASC. These removals ranges were 68-80% and 74-89% for COD removals respectively. Moreover, unlike ASC, there is no requirement of aeration for the operation of the TSUASB system, which makes it an economical treatment system. Finally, it was concluded that the TSUASB system can be a cost-effective and viable option for the treatment of municipal sewage over ASC, especially for low-income countries.