This study examined the feasibility of applying Upflow Anaerobic Sludge Blanket (UASB) bioreactor with phase separation including acidogenesis/methanogenensis, to treat dairy effluent. Dairy industry is one of the main agro industry in all over the world. At the same time the dairy industry is one of the most polluting of industries, not only in terms of the volume of effluent generated, but also in terms of characteristics as well. Many treatment methods are available to treat this wastes, but the anaerobic treatment methods is seems to be more viable for treatment of dairy waste as well as recover energy during this process. Among the anaerobic treatment two phase UASB reactor work efficiently to treat also to mitigate the issue of acidification nature of dairy effluent.