Industries are pillar for nation development, however their development comes with environmental disturbance. Industrial discharge contributes majorly in water pollution however this microbial culture, organic matter rich water serves as an excellent anolyte for Microbial Fuel Cell (MFC). Transfer of electrons is a crucial step in bio electrochemical process catalyzed by microbial community. Methylene Blue reduction method could be an game changer in MFC operations using dye reduction-based electron-transfer activity monitoring (DREAM) assay. Several industrial waste water samples were tested and noticed textile waste water as best suited for DREAM coefficient and electron transportation among other two selected (paper and paint). On screening various microbial dilutions (1x—0.125x) for optimization of DREAM coefficient for maximum power output, the necessity of active microbial populations along with metabolic state was confirmed. Additionally, on screening carbon source suitability (acetate, glucose and sucrose), it was established that maximum DREAM coefficient (0.66 ± 0.03) and power density (91.92 ± 0.81 mW/m2) was achieved with acetate as it is end product of numerous metabolic pathways. Optimized concentration of the best suited carbon source (i.e. acetate) was also analysed and recorded as 25 mmol/L generating maximum power output during MFC operation. Our results established and confirmed that novel DREAM assay as an appropriate, cost effective approach to estimate overall microbial electron exchange as it directly correlates with viable cell count and microbial activity of industrial waste water sample in MFC operation to analyze electrogenic microbial population responsible for bioremediation and green energy production.