A comparative study of enzyme-mediated indigo reduction is presented as an environmentally-friendly alternative to alkaline sodium dithionite reduction. The effect of the mediator 1,8-dihydroxy-9,10-anthraquinone in enzymatic reduction was studied by means of voltammetry, both in the presence and absence of different textile materials (polyamide 6, polyamide 6,6 and cotton), and compared to chemically reduced indigo. It was observed that bio-catalytic formation of leuco indigo and its exhaustion on substrates is inversely proportional to the pH within the range of 7–11. Additionally, substrate coloration was strongly influenced by the mediator, resulting in in situ formation of leuco indigo. This effect was most pronounced for polyamide substrates. The reuse of an enzyme-mediated reduction bath for dyeing was assessed showing that the levelness of the obtained shade was either excellent or good at pH 9 and 11, respectively. The wash, perspiration, and light color fastness properties of all textile materials dyed with enzymatically-reduced indigo were comparable or even better than those obtained with chemically reduced indigo. The use of enzyme-mediated reduction of indigo combined with potential reuse of the reduction bath represents a cost effective and environmentally-friendly dyeing process that can be applied for the dyeing of natural cellulosic and synthetic polyamide fibres.