An anaerobic digestion process for the treatment of domestic wastewater sludge that requires less space and funding to construct. Sludge to be treated is combined with recycled anaerobic digester sludge to form a blended sludge. The recycled anaerobic digester sludge provides a source of microorganisms necessary to initiate the breakdown of organic matter in the sludge to be treated. The sludge is then concentrated to increase total solids content to about 10-20%. Excess liquid is removed from the concentrated sludge. The concentrated sludge is then digested in an anaerobic reactor system such as a plug-flow reactor. Some benefits of the system's reduced volume, as a result of concentration of the sludge, include elimination of the necessity of substantially continuous stirring and the new possibilities for the types of construction to be used for the reactor. In addition to the reduced cost of the process itself, the process creates biogas that can be used to offset energy requirements for the process.