In order to improve the effectiveness of oily sludge reduction treatment, the operating parameters are optimised. Based on the characteristics of oily sludge composition and field trial process, the field trial sample testing method was studied. Using computational fluid dynamics software, the internal flow field and processing effect of the decanter centrifuge is simulated. Based on the simulation results, the characteristics of phase volume fraction and velocity distribution were analyzed and the orthogonal test method was used for process system design. The results show that by appropriately increasing the column length of the decanter centrifuge and reducing the feed rate, we can effectively improve the treatment effect. Through the design of the orthogonal test scheme design, the optimal operating parameter is determined to be the rotating speed of 2 339 r/min, the differential speed of 10 r/min, and the oily sludge feed rate of 7 m³/h. After treatment, the water content of oily sludge is reduced from 95.3% to 52.7%. This study provides guidance for the operation of oily sludge reduction treatment and the subsequent reduction of treatment costs.