Membrane bioreactor (MBR) is the combination of a membrane process like microfiltration or ultrafiltration with a suspended growth bioreactor, and is now widely used for municipal and industrial wastewater treatment with plant sizes up to 80,000 population equivalent 

When used with domestic wastewater, MBR processes could produce effluent of high quality enough to be discharged to coastal, surface or brackish waterways or to be reclaimed for urban irrigation. Other advantages of MBRs over conventional processes include small footprint, easy retrofit and upgrade of old wastewater treatment plants.

It is possible to operate MBR processes at higher mixed liquor suspended solids (MLSS) concentrations compared to conventional settlement separation systems, thus reducing the reactor volume to achieve the same loading rate.

http://en.wikipedia.org/wiki/Membrane_bioreactor