Agro-waste management processes are evolving through the development of novel experimental approaches to understand the mechanisms in reducing their pollution levels efficiently and economically from industrial effluents. Agro-industrial effluent (AIE) from biorefineries that contain high concentrations of COD and color are discharged into the ecosystem. Thus, the AIE from these biorefineries requires treatment prior to discharge. Therefore, the effectiveness of a continuous flow bioreactor system (CFBS) in the treatment of AIE using hybrid waste sludge biochar (HWSB) was investigated. The use of a bioreactor with hydraulic retention time (HRT) of 1–3 days and AIE concentrations of 10–50% was used in experiments based on a statistical design. AIE concentration and HRT were optimized using response surface methodology (RSM) as the process variables. The performance of CFBS was analyzed in terms of COD and color removal. Findings indicated 76.52% and 66.97% reduction in COD and color, respectively. During biokinetic studies, the modified Stover models were found to be perfectly suited for the observed measurements with R² values 0.9741 attained for COD. Maximum contaminants elimination was attained at 30% AIE and 2-day HRT. Thus, this study proves that the HWSB made from biomass waste can potentially help preserve nonrenewable resources and promote zero-waste attainment and principles of circular economy.