Abstract: Biological treatment of wastewaters is a growing field of active research mainly by using microalgae including cyanobacteria. Hypersaline cyanobacterium Phormidium tenue KMD33 isolated from the saltpans of Kattumavadi and was maintained in Mn medium with 100 ppt of salinity. P. tenue KMD33 isolate was inoculated in the 250 mL conical flask containing 200 mL of each effluent samples collected from different locations of Paper Mill industry and were maintained in culture room, Department of Microbiology, J.J. College of Arts and Science, Pudukkottai, Tamil Nadu, India under white fluorescent lamp Among the physicochemical parameters studied initially and after 20 days of incubation period with P. tenue KMD33, considerable reduction in the levels of chloride, salinity, alkalinity, calcium, magnesium, nitrite, nitrate, inorganic phosphate, COD, BOD and sulphate and the increasing levels of pH, dissolved oxygen and electrical conductivity were observed. A significant change in the color reduction (from 60-90%) was recorded after 20 days of incubation period. This preliminary result showed that the hypersaline cyanobacterium P. tenue KMD33 is an efficient candidate for the removal of colour from the effluent.