This paper provides an extensive review of anaerobic digestion (AD) systems, with a specific focus on community scale digesters for urban applications, processing either municipal organic waste exclusively or as mix feed. Emphasis is placed on reducing the systems scale environmental impact of AD technologies, including pre- and post-treatment stages, alongside biogas production. Developments to-date in AD system research in Europe and in the Asia region have been compared, providing a comprehensive evaluation of current practice, elucidating the areas of further potentials. The scope of this review is two-fold—one, covering AD technologies including a cohort of simple and integrated wet and dry systems, which can be operated as continuous flow designs in single- or multi-stages. Two, focusing more on practices in digestate handling that minimise environmental impacts arising from their storage and land application. From an environmental perspective, we note the following trends emerging in the literature for processing urban waste that need further exploitation: dry AD (60–85% moisture) is suitable for low organic loads, mainly owing to resource savings in terms of water usage; co-digestion has shown better buffering capability, especially for two-stage digestion of food-based feed stocks; separating the digestate into liquid/solid fractions is effective for handling post-digestion emissions, mainly for mitigating ammonia volatilisation to air and phosphate leaching to soil. We report responses to a survey, conducted for this review, highlighting the contemporary issues and challenges—with particular focus on the operational, social and management issues from an Indian perspective. There is need for follow-up of running plants to ensure their environmental performance. Such initiatives will have to consider managing of pollution footprints from AD, alongside the current drive for its widespread implementation for two incentives: greenhouse gas mitigation and fossil-fuel independence.