Oily sludge obtained from a refinery in India contained 10-11% oil associated with fine particulates. Along with Fe, Ca and Mg various toxic elements were associated with the sludge solids (Pb, Mn, Cu, Zn, As, Bi, Cd, Cr, Co, Ni and V). The oil contained 41-56% asphaltenes and the maltenes comprised of 49 ± 4%, 42 ± 2% and 4 ± 2%, aliphatic, aromatic and polar fractions, respectively. Biodegradation studies with the maltene fraction of oil provided as sole substrate revealed higher degradation by various 3-5 membered reconstituted consortia compared to pure bacterial strains and up to 42 ± 8% degradation could be achieved over 30 days. In contrast, over the same period up to 71.5 ± 2% oil degradation could be achieved using dried oily sludge (15% w/v) as sole substrate. Significant biodegradation observed in the un-inoculated controls indicated the presence of indigenous microorganisms in oily sludge. However, large variability in oil degradation was observed in the un-inoculated controls. Greater biodegradation of the maltene fraction led to significant enrichment of asphaltenes in residual oil associated with the sludge.