Bayer processing of bauxite employed for production of alumina yield a residue red-mud. The worldwide annual-rate of red-mud generation is approximately 120 million tons, and most of this is stockpiled. Red mud is rich in elements like aluminum, titanium and rare earths, in addition to the major iron-bearing constituents. The objective of this research is to explore such a strategy to extract Iron as fine particulate magnetite. Pyrometallurgical reduction experiments using carbon mixtures and a novel hydrometallurgical route are experimented. Reduction experiments performed with petroleum coke as a reductant resulted in incomplete reduction. The ‘optimal conditionsÂ’ for gaseous state reduction are determined to be: a processing temperature of 540oC ± 10oC, partial pressures CO (g) and CO2 (g) each of 0.070atm (bar) ± 0.001atm.(bar)/ inert diluent-gas: N2 (g), for a conversion-time of 30min. A mathematical-model was developed on the basis of unidirectional-diffusion of CO2 (g) within the CO2 (g)–CO (g)–N2 (g) gas-phase of the porous product-layer. Magnetic separation applied to the optimally reduced sample in: obtaining a magnetic portion with high iron and non-magnetic portion containing nonferrous (Al, Ti) is not successful. This finding was subsequently attributed to the nanometer length-scales crystallites of the predominant iron-containing phase, hydrated ferric-oxide(s) as determined by STEM micrographs. In addition, the presence of substitution for Fe3+ by Al3+ and Ti3+/4+ are determined with the help of MÖssbauer spectrograms. A hydrometallurgical route involving selective leaching and precipitation of iron in red-mud is tried. Red-mud is leached in oxalic acid at: 95˚C, 15 % Pulp density, 2.5 h leaching time, 1.5 pH. Kinetic studies yielded the leaching mechanism to be predominantly fluid film control. Ferric oxalate in the leach liquor is reduced to insoluble ferrous oxalate selectively using Iron powder. The ferrous oxalate formed is ~98 % pure. The precipitated ferrous oxalate is magnetically separated and reduced in Nitrogen atmosphere to form fine particulate magnetite. Additionally an economic feasibility study was conducted for the hydro and pyro alternatives to produce magnetite using Monte Carlo Simulations by imparting uncertainties in various input cost components. A traditional process was also compared to the proposed approaches for Total Capital Investment (TCI), Total Product Cost (TPC), Net Present Value (NPV) and sensitivity analysis. ~52 % reduction in Total product cost, 46 % reduction in Total Capital Investment was achieved for the hydrometallurgical process when compared to the traditional approach.