With water crisis getting severe each year all over the world, development in waste water recycling techniques has gained momentum to meet strict environmental norms and to take advantage of the recyclability of water. Biological treatment methods predominate over other recycling methods as they are less expensive and do not generate secondary pollutants. Challenges faced in using these methods such as low oxygen solubility in water or insufficiency in maintaining booming environment for microorganisms and sludge water separation issues restrain their full fledge utilization, thus hampering expenditure control and the final effluent quality which can be achieved otherwise. The developments made so far to overcome drawbacks of conventional activated sludge process revolves around modifications in suspended, attached growth process and improvements via integration of both systems. Further process refinement includes modifications in aeration and sludge separation systems but lacks the cost analysis for scale up. This paper critically reviews various internal design modifications made in aerobic treatment of wastewater by several researchers on lab and pilot scale to overcome the problem faced while operation. This paper also gives guidelines to meet the design objectives for a commercial scale wastewater treatment plant from process efficiency and economy aspects.