This study is to isolate the effluent strain of VAM fungi from polluted soils of sugar mill effluents. Analysis showed that pH and EC was more but the organic matter is less when compared to non-polluted soils. Even though there was low P content that enhances the mycorrhizal infection, the percent of root colonization was less than 75% in polluted study site. The number of VAM propagules and its distribution were also greatly affected due to various factors. Nine different VAM species were isolated and identified from the polluted study site. Using Allium cepa L. as the host plant the efficiency of the native effluent tolerant strains of VAM fungi isolated from the polluted study site was determined. Highest growth rate, high dry weight of gram per plant and increased growth was observed in the order of Glomus intraradices followed by Gigaspora margarita and Glomus fasciculatum. Consequence of the study clearly showed that Glomus intraradices was the efficient strain in sugar mill effluent polluted areas.