Currently, there is increasing interest in assessing the potential of bacterial laccases for industrial and environmental applications especially in harsh conditions. The environmental impact of the textile industry requires novel and effective technologies to mitigate the presence of dyes in wastewaters before discharging into the environment. Dyes usually remain stable in the presence of a variety of chemicals, light and are recalcitrant to microbial degradation. Among available technologies the biological treatments offer environmentally friendly strategies for decolorizing and detoxifying these compounds. The recent discovery of versatile laccases in streptomycetes opens up new opportunities for their commercial application. The aim of this study is to assess the potential of a novel bacterial laccase SilA produced by CECT 3341 active over wide temperature and pH ranges for use as an eco-friendly, biological treatment for the degradation of textile dyes. Insights into the enhancement of the oxidative action of this enzyme through the use of natural redox mediators are presented together with an assessment of the potential toxicity of the degradation products. Our results confirm that the combination of the laccase and natural mediators such as acetosyringone and methyl syringate enhanced the decolorization and detoxification of a variety of textile dyes up to sixfold and 20-fold, respectively. Mediator concentration was found to have a significant effect (p < 0.05) on dye decolorization at 60 °C; thus, the decolorization of Acid Orange 63 increased from 6 to 70-fold when the mediator concentration was increased from 0.1 to 0.5 mM. Further, the toxicity of tartrazine decreased 36-fold when the SilA-MeS system was used to decolorize the dye. The thermal properties of the SilA coupled with the stability of SilA at high pH suggest a potential commercial application for use in the decolorization of textile wastewaters which generally are performed at high temperature (>55 °C) and salinity and neutral pH, conditions which are unfavourable for conventional fungal laccases.