Recently an extensive studies have been carried out on aerobic granular sludge technology in both laboratory and technical scale. Aerobic granules are compact, spherical microbial consortia created by a spontaneous immobilization. Amongst their advantages are a very good settling ability, long biomass age and simultaneous pollutant removal in the granule structure that enables full biological treatment of wastewater in a single reactor. This review outlines up-to-date information on granule formation, morphology, microbial structure as well as on the applications of aerobic granular sludge technology for wastewater treatment including the treatment of high-nitrogen wastewater with a low COD/N ratio and wastewater of high toxicity. Aerobic granular sludge technology is presented as both environmentally and financially attractive alternative to wastewater treatment systems based on activated sludge or biofilm. This paper also reports on already existing full-scale installations in world and seeks to explore the potential of aerobic granular sludge within the Polish conditions.