Iron is essential for life, while also being potentially harmful. Therefore, its level is strictly monitored and complex pathways have evolved to keep iron safely bound to transport or storage proteins, thereby maintaining homeostasis at the cellular and systemic levels. These sequestration mechanisms ensure that mildly reactive oxygen species like anion superoxide and hydrogen peroxide, which are continuously generated in cells living under aerobic conditions, keep their physiologic role in cell signaling while escaping iron-catalyzed transformation in the highly toxic hydroxyl radical. In this review, we describe the multifaceted systems regulating cellular and body iron homeostasis and discuss how altered iron balance may lead to oxidative damage in some pathophysiological settings.