Ammonia retention and recovery from high-nitrogenous wastewater are new concepts being used for nitrogen management. A microaerophilic activated sludge system was developed to convert organic nitrogen into ammonia and retain it for its recovery; however, the settleability of activated sludge remains a challenge. Therefore, this study proposed an aerobic granular sludge system as a potential solution. Two types of sequencing batch reactors—airlift and upflow reactors—were operated to investigate the feasibility of fast granule formation, the performance of organic carbon removal and ammonia retention, and the dynamics of microbial community composition. The operation fed with industrial fermentation wastewater demonstrated that the airlift reactor ensured a more rapid granule formation than the upflow reactor because of the high shear force, and it maintained a superior ammonia retention stability of approximately 85 %. Throughout the operational period, changes in hydraulic retention time (HRT), settling time, and exchange ratio altered the granular particle sizes and microbial community compositions. Rhodocyclaceae were replaced with Comamonadaceae, Methylophilaceae, Xanthomonadaceae, and Chitinophagaceae as core taxa instrumental in granulation, likely because of their extracellular polymeric substance secretion. As the granulation process progressed, a significant decrease in the relative abundances of nitrifying bacteria—Nitrospiraceae and Nitrosomonadaceae—was observed. The reduction of settling time and HRT enhanced granulation and inhibited the activity of nitrifying bacteria. The success in granulation for ammonia conversion and retention in this study accelerates the paradigm shift from ammonia removal to ammonia recovery from industrial fermentation wastewater.