Toxic effects of herbal pharmaceutical wastewater on common fish (Lebistes reticulatus) under laboratory conditions were studied. LC50 values for raw, neutralized, and physico-chemically treated effluent for 24, 48, 72, and 96 h ranged between 3.0-9.5%, 5.0-10.5%, and 35-41%, respectively. It was evident from the studies that physico-chemical treatment reduces the toxicity by more than 30%. This article discusses in detail the bioassay evaluation of raw, neutralized, and primary treated effluent. Physico-chemically treated effluent was further subjected to biological treatment by activated sludge system. Effluent from biological treatment revealed no toxic effect even after one month of exposure.