Interfacial structure between iron and MgO has been studied in situ during deposition of iron on MgO surface, using soft x-ray absorption spectroscopy. Submonolayer sensitivity of the technique combined with the in situ measurements as a function of iron layer thickness allowed one to follow evolution of interfacial region. Two different substrates namely, MgO (001) single crystal, and a polycrystalline MgO film on Si substrate have been used in order to elucidate the role of the state of MgO surface in controlling the interface structure. It is found that at the interface of iron and MgO film, interfacial interaction results in formation of Fe 3 O 4 , while on MgO (001) surface iron mono-oxide is formed. Thickness of the interfacial layer has been determined with submonolayer accuracy. Fe 3 O 4 being the oxide of iron with the highest heat of formation, the evolution of the interface of Fe on MgO film appears to be controlled thermodynamically. On the other hand, on MgO (001) surface, interfacial reaction is limited by the availability of oxygen atoms. A comparison with earlier results suggest that magnetic behaviour of the FeO layer gets modified significantly due to proximity effect of the bulk ferromagnetic iron layer.