When upgrading an aging wastewater treatment plant (WWTP), the sludge management line is always out of consideration in terms of cost and easy-operation. This study presented the dynamics of the sludge when upgrading a conventional sequencing batch reactor (SBR) to green bio-sorption reactor (GBR) by embedding alum sludge-based constructed wetland (AlCW). The aluminum (Al(III)) content in the effluent and the resultant impact on organisms were also evaluated. The results showed that the Al(III) residues was at an acceptable level (<0.2 mg/L). The AlCW and its leachate Al(III) did not pose any detrimental impact on the activity of heterotrophic organisms and the nitrifiers whereas the activity of the polyphosphate accumulating organisms was completely suppressed and eliminated out of the reactor. In addition, the Al(III) hydroxides and natural organic matter promoted the flocculation of activated sludge flocs by complexation with the extracellular polymeric substances. As a result, the larger and compact activated sludge led to an increase of the settling velocity and the dewatering efficiency while deteriorating the sludge compressibility (sludge volume index of 150 mL/g). Interestingly, this laboratory-scale GBR was verified to be a promising alternative to upgrade the ageing WWTPs simultaneously with an improvement of the dewatering properties of the activated sludge.