The study was designed to explore the efficiency of magnetite nanoparticles (Fe3O4 NPs)/bacterial cell assembly to biodegrade lignin and lignocellulose, decontaminate pulp and paper-contaminated wastewater and optimize lignin adsorption by Fe3O4 NPs. Water samples were collected from three paper and carton manufacturing companies, Alexandria Governorate, Egypt. Pseudomonas otitidis MCC10330, the most active and promising strain among 10 previously screened indigenous and exogenous isolates, was selected and decorated with magnetic Fe3O4 Nanoparticles, that were prepared by the co-precipitation method, characterized and used to decontaminate paper and pulp effluent in a batch mode bioassay for 4 h. Fe3O4 NPs/bacterial cell assembly achieved the highest removals (64.1, 52.0, 54.3 and 66.6%) of TSS, COD, BOD, and Total Tannin and Lignin after 1, 4 and 4 h, reaching residual concentrations (RCs) of 322, 216, 112 and 7 mg/L, which are still slightly higher (5.35, 2.7 and 1.86-fold) than their maximum permissible limits (MPLs), respectively. RCs of pH, DO and TDS in the treated effluent are accepted for safe discharging. Maximum lignin adsorption and removal (82.14%) using Fe3O4 NPs was achieved at the optimized conditions (pH 6, Fe3O4 NPs dosage of 100 mg and 10 min contact time). Results confirmed that the proposed magnetite-coated Pseudomonas otitidis treatment system is highly efficient and recommended to treat the highly contaminated pulp and paper wastewater. Also, as far as we know, this integrated assemblage is the first time to be used as a novel, very promising, eco-friendly, renewable and economical biotechnological approach to minimize/eliminate the involved pollutants with the least running time.