Sludge incineration is becoming an important disposal method of industrial sludge from the viewpoint of the need to minimize the environmental impact. This work employs a pilot-scale fluidized bed incinerator to investigate the combustion characteristics of petrochemical sludge. Effects of different operating conditions on the performance of sludge incineration and the emission characteristics are investigated. Experimental results showed that operating temperature, excess air ratio, operating time, moisture of sludge, and chloride additives have significant effects on the combustion efficiency and the formation of air pollutants during sludge incineration. Higher operating temperature, excess air ratio, and lower moisture of sludge are beneficial to reduce the formation of hazardous organic pollutants BTEX (benzene, toluene, ethylbenzene, and xylene) and PAHs (polycyclic aromatic hydrocarbons), but increase the emission of fine particulate. An optimal operating time is also determined, at which interval the bottom ash in the fluidized bed incinerator should be drained or recycled to ensure good combustion efficiency.