The treatment and management of sewerage and sludge are experiencing a revolutionary makeover, propelled by pressures of dealing with environmental degradation, health issues, and resource shortages. This chapter offers an in-depth appraisal of recent developments in sewerage treatment and sludge management, with special focus on the shortcomings of traditional systems and the onset of novel, greener alternatives. The traditional processes like Activated Sludge Process and Trickling Filters are plagued with recurring problems of high energy requirements, inefficient removal of contaminants, and complicated waste disposal. To surmount the challenges, the chapter addresses state-of-the-art technology that involves membrane bioreactor (MBR), forward osmosis (FO), novel biological processes such as Anammox and aerobic granular sludge, and physico-chemical methods like advanced oxidation processes (AOPs) and electrocoagulation. Nature-based and phytoremediation methods are also covered from the viewpoint of their cost-effectiveness and eco-compatibility. Key modern practices in managing sludge include resource recovery, in the form of biogas, biochar, and nutrient reclamation, and thermal treatment processes of pyrolysis and plasma treatment. The chapter also combines the advances in a circular economy context, focusing on energy-neutral STPs, carbon footprint minimization, and resource valorization. Policy frameworks, institutional capacity, and public–private partnerships are also attended to. The concluding part of the chapter is a far-sighted vision in the form of smart, modular, and regenerative sanitation systems fuelled by artificial intelligence that could lead us on the path of sustainable and decentralized approaches for wastewater treatment. In the long run, the chapter emphasizes innovation-led, circular, and climate-resilient approaches in developing future-proof sewage and sludge management.