Wet air oxidation (WAO) of oily sludge was carried out using $Fe^{3+}$ as catalyst, placed in a 0.5 L batch autoclave in the temperature range of $250-330^{circ}C$. Experiments were conducted to investigate the effects of temperature, the initial COD, reaction time, concentration of catalyst and $O_2$ excess (OE) on the oxidation of the oily sludge. The results showed that in the WAO 88.4% COD was achieved after 9 min reaction at temperature of $330^{circ}C$, OE of 0.8 and the initial COD of 20000 mg/L. Temperature was found to have a significant impact on the oxidation of oily sludge. Adding a catalyst significantly improved the COD removal. Homogenous catalyst, $Fe^{3+}$, showed effective removal for pollutants. COD removal was 99.7% in the catalytic wet air oxidation (CWAO) over $Fe^{3+}$ catalyst. The results proved that the CWAO was an effective pretreatment method for the oily sludge.