Activation of microglia could be beneficial and yet simultaneously harmful depending upon nature of pathological milieu. Regardless of disease-specific etiology, iron accumulation, particularly in activated microglia, is a notable feature associated with a series of neuropathologies, including Alzheimer's diseases. Although mounting evidence supports the role of iron in oxidative brain injury, knowledge on its regulatory role in neuroinflammation is still scarce. Here, we hypothesize that cellular iron status may be involved in determining the roles of activated microglia in neuroinflammatory processes. In this study, we examined effects of iron on expression of MMPs known to be involved in nervous system inflammation and degeneration using rat microglial cell line (HAPI). Stimulation experiments were performed using lipopolysaccharide (LPS). We demonstrated by RT-PCR that increased cellular iron levels enhanced the expression of MMP-9 in activated microglia, but had no effect on MMP-1. Studies using western blot and gelatin zymography analyses demonstrated that increased cellular iron levels in activated microglia enhanced the secretion of MMP-9 and MMP-1. Taken together, these results demonstrated regulatory roles of iron in the expression of MMPs by activated microglia at the transcription and translation levels. Using a colorimetric NBT reduction assay, we showed that increased cellular iron levels impaired zymosan phagocytic activity in activated microglia. Thus, these findings further our understanding toward the consequences of iron accumulation by activated microglia in neurodegeneration and suggest a possible link between iron metabolism in activated microglia and neuroinflammation.