In this study, a novel wastewater treatment process combining sequencing batch reactor, constructed wetland and microalgal membrane photobioreactor (BCM process) was proposed, and its performance on removal, transformation and toxicity reduction of polycyclic aromatic hydrocarbons (PAHs) was intensively explored. Satisfactory PAHs removal (90.58%–97.50%) was achieved and molecular weight had significant impact on the removal pathways of different PAHs. Adsorption dominated the removal of high molecular weight PAHs, while the contribution ratio of microbial degradation increased with the decrease of molecular weight of PAHs. More importantly, it was reported for the first time that substituted PAHs (SPAHs) produced by microbial degradation of PAHs would lead to increased toxicity during the BCM process. High PAHs (75.37%–88.52%) and SPAHs removal (99.56%–100.00%) were achieved in the microalgae unit due to its abundant cytochrome P450 enzyme, which decreased the bacterial toxicity by 90.93% and genotoxicity by 93.08%, indicating that microalgae played significance important role in ensuring water security. In addition, the high quantitative relationship (R2 = 0.98) between PAHs, SPAHs and toxicity exhibited by regression model analysis proved that more attention should be paid to the ecotoxicity of derivatives of refractory organic matters in wastewater treatment plants.