A major challenge in developing countries concerning domestic wastewaters is to decrease their treatment costs. In the present study, a new cost-effective reactor called gradual concentric chambers (GCC) was designed and evaluated at lab-scale. The effluent quality of the GCC reactor was compared with that of an upflow anaerobic sludge bed (UASB) reactor. Both reactors showed organic matter removal efficiencies of 90%; however, the elimination of nitrogen was higher in the GCC reactor. The amount of biogas recovered in the GCC and the UASB systems was 50% and 75% of the theoretical amount expected, respectively, and both reactors showed a slightly higher methane production when the feed was supplemented with an additive based on vitamins and minerals. Overall, the economical analysis, the simplicity of design and the performance results revealed that the GCC technology can be of particular interest for sewage treatment in developing countries.