This study applied the anaerobic fermentation process to the production of methane from the organic fraction of urban refuse. Shredded domestic refuse from which the inorganic fraction was separated was used as a substrate. Raw sewage sludge was added to the substrate in proportion to the rate at which it is produced by a population producing a given quantity of refuse. The quantity and quality of gas produced, the rate of gas production, the solids reduction, nutritional requirements, and operating problems were evaluated in a laboratory system operating at temperatures ranging from 35C to 60C. The results of the laboratory study together with published data on both capital and operating costs of refuse shredding, refuse separation, reactor volume, reactor mixing, reactor heating, and residue dewatering were used to analyze the economics of the process. (Modified author abstract)