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In this paper, an innovative method is proposed to upgrade iron and remove phosphorus from high-phosphorus oolitic hematite ore by the sodium magnetization roasting–magnetic separation–sulfuric acid and sodium hydroxide leaching process. The process parameters of sodium magnetization roasting, acid leaching, and alkaline leaching were optimized. The results show that by only adopting traditional magnetization roasting–magnetic separation, an iron ore concentrate containing 57.49% Fe and 1.4% P2O5 at an iron recovery rate of 87.5% and a dephosphorization rate of 34.27% was produced, indicating that it is difficult to effectively dephosphorize and upgrade iron by the conventional magnetization roasting–magnetic separation process. The obtained rough magnetic concentrates were then subjected to acid and alkaline leaching steps, and the final product, assayed at 64.11% iron and 0.097% P2O5, was manufactured successfully. Moreover, the added NaOH could promote the mineral phase reconstruction of aluminum- and silica-bearing minerals during magnetization roasting and intensify the upgrading of iron as well as enhance the growth of iron grains.