The commercial processing of various biomaterials extensively uses azo dyes (including reactive, direct, acidic, and basic dyes). These industrial applications produce wastewater containing a large volume of solubilized azo dye and hydrolyzed by-products. The treatment of such wastewater is primarily carried out by chemical and, to an extent, physical methods, which lack selectivity and efficiency. Notably, the chemical methods employ free radicals and oxidizing agents that further increase the chemical waste and produce non-biodegradable side-products. Therefore, there is an increasing trend of using microbial-assisted methods. The current study identified a specific Agrobacterium strain (JAS1) that degraded the three structurally distinct azo dyes (Reactive Black 5, Methyl Orange, Congo Red). JAS1 can tolerate high concentrations and be used to perform the in-solution degradation of azo dyes, respectively: Methyl Orange (5.5 g/L and 5.0 g/L), Congo Red (0.50 g/L and 0.40 g/L), and Reactive Black 5 (0.45 g/L and 0.40 g/L). Our study elucidated the molecular mechanisms (primarily enzymatic degradation and adsorption) responsible for the JAS-1-assisted decoloration of azo dyes. The JAS-1-assisted degraded products from these azo dyes were found biodegradable as the germination and seedling growth of wheat seeds were observed. To enhance the scope of the study, JAS1-assisted decolorization was studied for cellulosic materials, indicating a potential application in de-inking and de-dyeing process in recycling industries.