Abstract: Nitrogen pollution often restricts the stable operation of the culture system during the indoor culture of Penaeus monodon. The encapsulated denitrifying bacterial capsule technology based on high-permeability fiber membranes has been applied in aquaculture water treatment. In this study, the system with encapsulated denitrifying bacterial capsules was set as the experimental group, and the system without capsules as the control group. Dynamic monitoring of water quality indicators was carried out, combined with scanning electron microscopy (SEM) to analyze the structural changes on the surface of the encapsulated bacterial membrane, and metagenomic sequencing technology was employed to characterize the microbial communities in both the water and bacterial capsules, aiming to explore its in-situ regulation effect and mechanism on aquaculture water quality. The results show that the ammonia nitrogen (NH₄⁺-N) in the experimental group peaked on day 12 at a concentration of 1.42 mg·L⁻¹, which was 4 d earlier than that in the control group with a lower peak concentration. The nitrite nitrogen (NO₂⁻-N) in the experimental group peaked on Day 20 at a concentration of 2.80 mg·L⁻¹, 20 d earlier than that in the control group, with a peak concentration reduction of 69.5%. The fiber spacing of the encapsulated bacterial membrane increased, and distinct microbial adhesion and deposition structures formed on its surface. The diversity and richness of the microbial community inside the encapsulated bacterial membrane increased significantly (p<0.05). The species richness of the microbial community in the water of the experimental group was higher than that of the control group, and was highly similar to the microbial composition of the encapsulated bacterial membrane. The dominant bacterial phyla were mainly Pseudomonadota and Bacteroidota, while the dominant genera at the genus level included Nitrospira, Winogradskyella, etc. The abundances of denitrification and nitrification related functional genes as well as nitrogen metabolism pathways in the experimental group were all higher than those in the control group. This study reveals the physical protection of denitrifying functional bacteria by the fiber membrane encapsulation system and its ecological regulatory effect on the microbial community, demonstrating that the addition of encapsulated denitrifying bacteria can improve the nitrogen accumulation status in aquaculture water, enhance the functional characteristics related to nitrogen metabolism, and thereby achieve in-situ regulation of water quality.