The integration between engineering and knowledge systems (KS) in a manufacturing environment in a network of industrial enterprises was investigated. The drivers for this application of engineering design to infrastructure in an industrial setting where cost and time to market are vital were to spread best practice, and to gain experience in dealing with the regulatory authorities according to ISO 14000. Therefore, the aim of this study was to evaluate the performance of the industrial wastewater treatment plant of the Hilla Textile Factories, to find an appropriate method of treating the industrial wastewater so as to render it fit for reuse or safe to be disposed of as stipulated by the Iraqi laws on effluent disposal. The removal efficiencies of the different parameters used to describe water quality was low. It was found that the removal efficiency of COD (Chemical Oxygen Demand) was 20-21%, that of BOD (Biochemical Oxygen Demand) was 17-30% and that of TSS (Total Suspended Solids) was 27-31%. The quality of the effluent was not in line with those of either the Iraqi or American standards.