Thermophilic biological denitrification was studied in a laboratory-upflow sludge blanket reactor fed with ethanol as carbon and energy source. High denitrification efficiency (> 98%) was obtained at an ethanol:nitrate ratio > 2 and at a hydraulic retention time (HRT) of 5 hours. The performance of the system with respect to nitrate removal was very satisfactory (> 95%), even at high nitrate (235 mg NO3-N/L) and hydraulic (3 hours HRT) loading rates applied. A stable sludge was formed by spherical granules 1 to 3 mm in diameter with a content of 25,8 g VS/L and were almost exclusively composed of bacteria belonging to the genus Bacillus.