Aerobic granulation is a promising technology for wastewater treatment, but problems regarding its formation and stability need to be solved. Divalent metal ions, especially Ca2+, Mg2+ and Mn2+, have been demonstrated to play an important role in the process of aerobic granulation. Here, we studied whether iron ions can affect aerobic granulation. Granular sludge formed without iron ion addition (< 0.02 mg Fe2+ L-1) was fluffy and had a finger-type structure and filamentous out-growth. The addition of iron ions to concentrations of 1 and 10 mg Fe2+ L-1 repressed the finger-type structure and filamentous out-growth. The results show that chemical precipitation in the granules with iron ion addition was higher than that in the granules without ferrous addition. The amount of precipitates was higher inside the granules than outside. This study demonstrates that iron ions (Fe2+/Fe3+) increase the size and stability of aerobic granular sludge but do not affect the granulation time, which is the time that the first granular sludge is observed. The study shows that aerobic granular sludge technology can be confidently applied to actual wastewater containing a high concentration of iron compounds.