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Iron is important for a remarkable array of essential functions during brain development, and it needs to be provided in adequate amounts, especially to preterm infants. In this review article, we provide an overview of iron metabolism and homeostasis at the cellular level, as well as its regulation at the mRNA translation level, and we emphasize the importance of iron for brain development in fetal and early life in preterm infants. We also review the risk factors for disrupted iron metabolism that lead to high risk of developing iron deficiency and subsequent adverse effects on neurodevelopment in preterm infants. At the other extreme, iron overload, which is usually caused by excess iron supplementation in iron-replete preterm infants, might negatively impact brain development or even induce brain injury. Maintaining the balance of iron during the fetal and neonatal periods is important, and thus iron status should be monitored routinely and evaluated thoroughly during the neonatal period or before discharge of preterm infants so that iron supplementation can be individualized.