A mixed bacterial culture (SKB-II) comprising of five bacterial isolates Bacillus vallismortis, Bacillus pumilus, Bacillus cereus, Bacillus subtilis and Bacillus megaterium, developed from an effluent treatment plant of a textile & dyeing industry, was evaluated for its ability to decolorize azo dye Direct Red 28 in an up flow immobilized cell bioreactor using plastic clips as a support for biofilm formation. The bioreactor was operated under various parameters: aeration rates of 10 ml min^-1 & 15 ml min^-1 with flow rates of 60, 90 & 120 ml h^-1 respectively. At constant aeration rate of 10 ml min^-1 and with flow rates 60, 90 & 120 ml h^-1, optimum decolorization of 69, 71 and 70% decolorization was observed while at aeration rate of 15 ml min^-1 and flow rates of 60, 90 & 120 ml h^-1, optimum decolorization of 73, 66 and 63% decolorization was observed. The study concluded that across the two aeration rates and the respective flow rates, aeration rate of 15 ml min^-1 along with flow rate of 60 ml h^-1 was best suited to decolorize Direct Red 28 in the up flow immobilized cell bioreactor. Spectral changes of the input and output of the bioreactor by UV-visible, spectroscopy indicated decolorization of the dye solution by degradation in addition to the visual observation of the biosorption process. On the basis of the results of this study an ‘on-site’ treatment system can be developed to achieve decolorization for azo dye effluents.