The global reliance on non-renewable fossil fuels highlights the urgent need for sustainable alternative energy sources. Hydrothermal liquefaction (HTL) offers a promising solution by converting biomass, such as sewage sludge, into biocrude oil. However, the integration of excess HTL-process water (HTL-PW), a by-product of this process, into conventional wastewater treatment requires careful evaluation. This study investigates the effects of recirculating HTL-PW in sequencing batch reactors (SBRs) using synthetic wastewater. Two SBRs were operated in parallel: one fed 0.15 % (v/v) HTL-PW and the other with only synthetic feed. The reactor receiving HTL-PW demonstrated superior stability, effective nitrification, and consistent denitrification with no adverse effects on nitrogen species turnover. A comprehensive approach combining 16S rRNA gene amplicon sequencing for relative abundance and metagenomic analysis, for enhanced resolution of nitrogen-transforming populations, revealed the genetic repertoire and potential of 58±4 % and 65±4 % of the genus-level annotations from the HTL-PW and control reactors, respectively. The HTL-PW-fed reactor maintained robust performance, with microbial community analysis revealing a strong association between nitrogen transformations and specific microbial taxa, thereby explaining the observed reactor stability and efficiency in nitrogen conversion. These findings demonstrate the feasibility of integrating HTL-PW into wastewater treatment systems, showing that recirculating HTL-PW at the tested concentrations does not adversely affect nitrogen transformations, supports stable nitrification and denitrification, ensures complete ammonium utilisation, and promotes diverse and dynamic microbial communities similar to those in full-scale wastewater treatment plants.