The presented work investigates a novel method to manufacture 98.8% pure iron strips having high permeability and better saturation flux density for application in magnetic flux shielding. The proposed method uses electro-deposition and cold rolling along with intermediate annealing in a controlled environment to manufacture 0.05–0.5 mm thick pure iron strips. The presented approach is inexpensive, has better control over scaling/oxidation and requires low energy than that of the conventional methods of pure iron manufacturing by pyrometallurgical methods. Important magnetic and mechanical properties of the pure iron are investigated in the context of the application of the material in magnetic shielding. Magnetic properties of the material are investigated by following IEC60404-4 standard and toroidal coil test to determine hysteresis curve, magnetic permeability and core losses. The microstructure is investigated with an optical microscope and scanning electron microscopy to study grain size and defects after cold rolling and annealing. The properties derived from the experimental methods are used in finite element analysis to study the application of the material for static, low-frequency and high-frequency magnetic shielding. Theoretical simulation results for magnetic shielding around a current-carrying conductor and micro-electromechanical inductive sensor system are discussed. Further shielding performance of the material is compared with that of the other candidate materials, including that of Mu-metal and electrical steel. It is demonstrated that the pure iron strips manufactured in the present study can be used for magnetic shielding in the case of low-frequency applications. In the case of high-frequency applications, a conducting layer can be combined to ensure the required shielding effectiveness in the case of Class 2 applications.