This contribution reports the redistribution behaviour of Fe during the growth of InP layers from liquid phase with addition of some rare earth elements on semi‐insulating InP:Fe substrates. We have studied the influence of different rare earths on the Fe diffusion into InP layer and compared it with the phenomenon of an extraction of iron from Fe doped materials into adjacent layers doped by Zn, Cd and Be, reported recently. In the case of Tm addition a conversion of electrical conductivity of InP layer to semi‐insulating as a consequence of Fe diffusion has been observed while no significant Fe inter‐diffusion has been confirmed in the presence of other investigated rare earth additions. (© 2005 WILEY‐VCH Verlag GmbH & Co. KGaA, Weinheim)