The surface display laccase (SDL) biocatalyst, where the enzyme laccase is displayed on the surface of biological cells through synthetic biology, provides a new opportunity to develop sustainable technologies for removal of emerging contaminants from wastewater. This study vigorously characterized biocatalytic properties of the SDL in comparison to free laccase in removing emerging contaminant acetaminophen (APAP), with the aim to understand the effect of surface display on enzyme functionality and identify the strategy to overcome the potential limitation. The SDL could effectively remove APAP. Adding redox mediators substantially improved the removal efficiency. The Michaelis-Menten kinetic analysis showed that the redox mediator 2,2-azinobis-3-ethylbenzothiazoline-6-sulfonate could overcome the limitation of APAP accessing the active site of laccase in the SDL biocatalyst. The APAP removal rate catalyzed by the SDL in real secondary wastewater effluent was higher than that in acetate buffer; comprehensive enzyme kinetic analysis provided clear evidence that there were redox mediating compounds in the wastewater. Analysis of transformation products revealed that surface display did not change laccase functionality in terms of APAP transformation mechanism. In addition, the SDL retained 88% of the initial activity after six repeated APAP biotransformation reactions. Results from this study provide a scientific basis for developing and implementing SDL as an innovative biocatalytic material for contaminant treatment applications.