Direct methanol fuel cells (DMFCs) hold great promise for applications ranging from portable power for electronics to transportation. However, apart from the high costs, current Pt‐based cathodes in DMFCs suffer significantly from performance loss due to severe methanol crossover from anode to cathode. The migrated methanol in cathodes tends to contaminate Pt active sites through yielding a mixed potential region resulting from oxygen reduction reaction and methanol oxidation reaction. Therefore, highly methanol‐tolerant cathodes must be developed before DMFC technologies become viable. The newly developed reduced graphene oxide (rGO)‐based Fe‐N‐C cathode exhibits high methanol tolerance and exceeds the performance of current Pt cathodes, as evidenced by both rotating disk electrode and DMFC tests. While the morphology of 2D rGO is largely preserved, the resulting Fe‐N‐rGO catalyst provides a more unique porous structure. DMFC tests with various methanol concentrations are systematically studied using the best performing Fe‐N‐rGO catalyst. At feed concentrations greater than 2.0 m, the obtained DMFC performance from the Fe‐N‐rGO cathode is found to start exceeding that of a Pt/C cathode. This work will open a new avenue to use nonprecious metal cathode for advanced DMFC technologies with increased performance and at significantly reduced cost.