Upflow anaerobic sludge blanket (UASB) reactors, with or without granular activated carbon (GAC) amendment, were applied for blackwater treatment. The impact of GAC on the formation of granules and biomethane recovery was assessed. High organic loading rates (OLRs) up to 15.7 ± 2.1 kg COD/(m3d) were achieved with both reactors. Similar chemical oxygen demand (COD) removal and methane production rate were observed with OLRs ranging from 5.1 ± 1.0 to 9.3 ± 1.5 kg COD/(m3d). Under higher OLR conditions (13.6 ± 1.1 to 15.7 ± 2.1 kg COD/(m3d)), the GAC-amended UASB achieved a higher COD reduction than the UASB without GAC addition. Interestingly, volatile suspended solids (VSS) concentrations, granule size, and extracellular polymeric substance concentrations were lower in the GAC-amended UASB reactor as compared to the UASB without GAC. The methanogenesis activity of the granules in the GAC-amended UASB reactor was significantly higher than the methanogenesis activity of the UASB granules. The microbes o_Bacteroidales and Syntrophus were predominant in both reactors. The acetoclastic methanogens dominated in the UASB reactor without GAC addition; while hydrogenotrophic methanogens dominated in the GAC-UASB reactor. A phylogenetic investigation of communities by reconstruction of unobserved states (PICRUSt) indicated that syntrophic acetate oxidation improved with GAC addition. The co-occurrence network indicated that interactions between dominant bacteria and archaea were higher in the GAC-amended UASB reactor than in the UASB reactor without GAC addition. This study demonstrated the improved blackwater treatment performance as a result of granulation in UASB with the addition of GAC.