Abstract: This invention relates to a method and apparatus for forming a compost product from organic matter having high water content: the method involving (1) holding organic matter with a large amount of water in a treatment tank for one to three hours while providing a supply of air, heating to not more than 60.degree. C. and agitating and grinding the organic matter so that the matter is reduced to a rice porridge state and aerobic fermentation occurs, extracting generated gas and water vapor to the outside of the tank, thereby dehydrating and drying the organic matter to form a fermentation and decomposition product having a water content of not more than 65%, (2) holding the fermentation and decomposition product for one to six hours at a temperature between 60.degree. C. and 100.degree. C.