The competitive reduction behaviour of C and CO on the surface of Fe2O3 in blast furnaces was studied based on experiments and the first-principles calculations. The material morphology and element distribution of Fe2O3 under the conditions of C, CO and C + CO reduction were compared. In order to further investigate the competitive reduction behaviour of C and CO on the Fe2O3 surface, based on the first-principles calculation, the adsorption mechanism of C and CO on the α-Fe2O3(001) surface was studied by calculating the parameters of bond length, adsorption energy, charge density and state density. The results showed that under the condition of C + CO co-reduction, the reduction degree of Fe2O3 is better. When CO was adsorbed on the α-Fe2O3 (001) surface alone, the adsorption energy of the adsorption structure was −0.549 eV. The state density peak of the CO molecule on the left side of the Fermi level was sharper, and the electron delocalization around the CO molecule was weaker. Compared with the C atom, the CO molecule was less easily adsorbed on the α-Fe2O3 (001) surface, and the structure stability of the adsorbed products generated by the CO molecule was also lower. Compared with the adsorption of C and CO on the α-Fe2O3 (001) surface alone, the co-adsorption energy of C atom and CO molecule was relatively low, which was −7.755 eV, and the co-adsorption structure was more stable, and the presence of CO was more conducive to the interactions between C and α-Fe2O3 (001) surface.