A novel decentralised sewage treatment reactor (DSTR) for treating domestic sewage in rural areas was designed and investigated. The reactor was started aerobically after inoculation with biomass; the amount of initial mixed liquid suspended solids was 1.5 g/L. Oxygen was supplied to the reactor and the dissolved oxygen concentration was maintained at 1.3 ± 0.2 mg/L. The pollutant removal performance was investigated, and the average removal efficiencies of total chemical oxygen demand (TCOD), NH4+-N, suspended solids, and turbidity were 76%, 77.15%, 84.17%, and 83.93%, respectively. The DSTR exhibited good performance compared with the traditional activated sludge (AS) reactor. The resistance to impact load of the DSTR was superior to that of the AS reactor during surface load experiments. During the 120 days of operation, no sludge bulking was observed. The DSTR effluent NH4+-N and TCOD levels were a little higher than those for the AS reactor, but the disparity was not major.