A simple reduction method has been used for successfully synthesizing Galaxaura rugosa-mediated iron nanoparticles (FeNPs). The FeNPs were characterized using UV–visible spectroscopy, X-ray diffraction analysis (XRD), Transmission electron microscopy (TEM), Selected area electron diffraction (SAED), Scanning electron microscopy (SEM), Energy dispersive analysis of X-rays (EDAX), Zeta potential, and Fourier transform infrared spectroscopy (FTIR). The early formation of FeNPs is supported by rapid color change from yellow to dark brown and UV-visible absorption peaks at 327 nm. The XRD pattern and SAED analyses show a crystalline nature of FeNPs. Biogenic FeNPs were found to be spherical with mean diameter sizes varying from 14.4 to 17.2 nm by TEM image. The high abundance of FeNPs produced is visible in SEM, and the particles are in aggregates. The biosynthesized FeNPs had a negative surface charge with zeta potential values of -38.4 mV. According to FTIR analysis, functional groups play a significant role in the bioreduction of iron ions and the stability of FeNPs. This method is straightforward in application and environmentally friendly and could be performed in eco-friendly projects.