The effect of casing treatment on flow stability of a multi-stage compressor was investigated through computational fluid dynamics (CFD) as well as compressor rig test method. Of particular interest here is the type of casing treatment which exacts air from a high pressure region over the rotor tips and re-injected to just upstream of the same blade row. The air was exacted through a circumferential groove on the first stage rotor (R1) casing of a five-stage transonic axial compressor; guide vanes were placed in the circumferential groove to guide the re-circulated flow. The calculations as well as the rig test results show that the surge margin has been improved by both casing treatment configurations. Both configurations have near the same surge margin enhancement effectiveness at off-design speed. A maximum of 26.2 percent improvement in stall margin was achieved by 166P20 test results. The main differences between both configurations are compressor peak efficiency at the part and design speed. 166P20 configuration has higher peak efficiency than the 166N70 configuration, which means the rear segment skew angle of the guide vane has strong influence on the loss of the recirculation casing treatment.