Effluent circulation may affect the phase separation ability of a compartmentalized anaerobic reactor such as anaerobic baffled reactor. In this study, it is proven that this is not always the case. Moreover, the effect of circulation to this type of reactor under different hydraulic retention time (HRT) is still unclear. The present study investigates the start-up performance of a novel modified anaerobic baffled reactor (MABR) at various effluent circulation ratios (R). Results showed that tremendous increase of the treatment efficiency and stable performance was achieved by the MABR system when effluent circulation was employed (e.g. 95.7% COD removal during R of 2 at HRT of 2d and an OLR of 0.75kgCODm(-3)d(-1)). The pH profiles, volatile acids (HOAc) occurrence and biogas production during the start-up period showed favourable conditions in the reactor. In addition, the effect of HRT variations (4, 3, 2 and 1d) to the MABR with circulation operation R of 2 (optimum circulation) showed the HRT of 2 and 3 caused the MABR to start-up rapidly and efficiently with a chemical oxygen demand removal efficiency of more than 90%. It was concluded that rapid start-up can be achieved by applying effluent circulation to the MABR