Decolorization of textile dyes by a laccase from Trametes modesta immobilized on gamma-aluminum oxide pellets was studied. An enzyme reactor was equipped with various UV/Vis spectroscopic sensors allowing the continuous online monitoring of the decolorization reactions. Decolorization of the dye solutions was followed via an immersion transmission probe. Adsorption processes were observed using diffuse reflectance measurements of the solid carrier material. Generally, immobilization of the laccase does not seem to sterically affect dye decolorization. A range of commercial textile dyes was screened for decolorization and it was found that the application of this enzymatic remediation system is not limited to a certain structural group of dyes. Anthrachinonic dyes (Lanaset Blue 2R, Terasil Pink 2GLA), some azo dyes, Indigo Carmine, and the triphenylmethane dye Crystal Violet were efficiently decolorized. However, the laccase displayed pronounced substrate specificities when a range of structurally related model azodyes was subjected to the biotransformation. Azodyes containing hydroxy groups in ortho or para position relative to the azo bond were preferentially oxidized. The reactor performance was studied more closely using Indigo Carmine.