Morphology of the granules formed in anaerobic digestion of distillery wastewater was studied in two laboratory scale bioreactors i.e., upflow anaerobic sludge blanket reactor and hybrid reactor. The effects of two different inoculum sludges in early granulation and start-up were studied. Study revealed that earlier start-up and granulation of biomass could be achieved using mixed sludge (anaerobic digested sludge: cowdung and aerobic sludge) than anaerobically digested sludge. Scanning electron microscope (SEM) study of the granules showed predominance of Methanosarcina and Methanothrix type of species on the surface of granules. The change in the morphology and other physical parameters of the granules due to increase in organic loading rate were also studied. The size distribution of granules across the height of the sludge bed showed that the granules of larger diameter having higher settling velocity are mainly concentrated at the lower active zones while smaller sized granules having less settling velocity were found at the top and middle zones of the sludge bed.