A system and method for the production of microbial consortiums and by-product material is provided. A physical containment system comprising phase spaces arranged in a discrete order to favor specific biological reactions is also provided. Phase profiles and phase data sets include the pre-determined physical and biological parameters for the phase space transitions. Movement of material from one phase to the next is hydraulically balanced enabling working fluid to continuously move in a fixed direction and rate of flow. Continuous monitoring of phase profiles and phase data sets provide feedback to the system enabling alteration of the conditions in the system to control reactions therein.