The presence of emerging biological pollutants in treated wastewater effluents has gained attention due to increased interest in water reuse. To evaluate the effectiveness of the removal of such contaminants by the conventional wastewater treatment process, the fate and decay kinetics of NDM-1-positive Escherichia coli strain PI7 and its plasmid-encoded antibiotic resistance genes (ARGs) were assessed in microcosms of anaerobic and aerobic sludge. Results showed that E. coli PI7 decayed at a significantly slower rate under anaerobic conditions. Approximate half-lives were 32.4 ± 1.4 h and 5.9 ± 0.9 h in the anaerobic and aerobic microcosms, respectively. In the aerobic microcosms, after 72 h of operation, E. coli PI7 remained detectable but no further decay was observed. Instead, 1 in every 10000 E. coli cells was identified to be recalcitrant to decay and persist indefinitely in the sludge. ARGs associated with the E. coli PI7 were detected to have transferred to other native microorganisms in the sludge, or are released to the liquid fraction upon host decay. Extracellular DNA quickly degraded in the liquid fraction of the aerobic sludge. In contrast, no DNA decay was detected in the anaerobic sludge water matrix throughout the 24 h sampling period. This study suggests an increased likelihood of environmental dispersion of ARGs associated with anaerobically treated wastewater effluents and highlights the potential importance of persister cells in the dissemination of E. coli in the environment during reuse events of treated wastewater.IMPORTANCE This study examines the decay kinetics of a pathogenic and antibiotic resistant strain of Escherichia coli in microcosms simulating biological treatment units of aerobic and anaerobic sludge. The results of this study points at a significantly prolonged persistence of the E. coli and the associated antibiotic resistance gene in the anaerobic sludge. However, horizontal transfer of the plasmid encoding the antibiotic resistance gene were detected in the aerobic sludge by cultivation method. Detection of a subpopulation of persister E. coli were also detected in the aerobic sludge. The findings of this study suggest potential areas of concern arising from pathogenic and antibiotic-resistant E. coli during both anaerobic and aerobic sludge treatment processes.