In recent decades, nanoscale zero-valent iron (nZVI) has been extensively studied for application in environmental remediation because it is an eco-friendly, inexpensive nanomaterial with high reactivity. The chemical reduction of iron ions using NaBH4 in a liquid solution is the most frequently used method to obtain nZVI, but its drawbacks are the use of expensive and toxic NaBH4 and the secondary pollution caused by the B(OH)3 by-product. In this study, in order to obtain nZVI in a cleaner manner, we used a reduction method for Fe2O3 using CaH2, which is non-toxic and generates no pollutants. The results of X-ray diffraction, nitrogen adsorption, and scanning electron microscopy for the obtained samples indicated the formation of zero-valent iron nanopowder (22.5 m2/g) that was obtained via reduction at 220 °C for 5 h. The obtained nZVI was finally tested in the catalytic hydrogenation of p-nitrophenol as a model reaction of water remediation, verifying its good catalytic performance.