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Aims: To evaluate the potential of Brevibacillus laterosporus MTCC 2298 for the decolourization of different textile azo dyes including methyl red, mechanism of biotransformation and the toxicity of products. Methods and Results: Brevibacillus laterosporus showed decolourization of thirteen different azo dyes including methyl red. Decolourization of methyl red was faster (93% within 12 h) under static condition at the concentration 0·2 g l−1. Induction in the activities of lignin peroxidase, laccase, aminopyrine N-demethylase, NADH-DCIP reductase and malachite green reductase was observed in the cells obtained after decolourization. Fourier transform infra-red spectral analysis of products indicated conversion of methyl red into secondary aryl amines and nitrosamines, which further transformed into the aromatic nitro compounds. Gas chromatography–mass spectroscopy analysis suggested conversion of methyl red into high molecular weight complex derivatives. The heterocyclic substituted aryl amine ( m/ z 281), p-(N,N di formyl)-substituted para-di amino benzene derivative ( m/ z 355) and p-di-amino benzene derivative ( m/ z 282) are the mainly elected biotransformation products. Microbial and phytotoxicity studies suggested nontoxic nature of the biotransformation products. Conclusions: Brevibacillus laterosporus has potential for the decolourization of different textile azo dyes. Significance and Impact of the Study: Brevibacillus laterosporus decolourized different azo dyes including methyl red and can be utilized for textile dye decolourization. [ABSTRACT FROM AUTHOR]