Cellular iron homeostasis is critical for survival and growth. Bacteria employ a variety of strategies to sequester iron from the environment and to store intracellular iron surplus that can be utilized in iron-restricted conditions while also limiting the potential for the production of iron-induced reactive oxygen species (ROS). Here, we report that membrane-derived oligosaccharide (mdo) glucan, an intrinsic component of Gram-negative bacteria, sequesters the ferrous form of iron. Iron-binding, uptake, and localization experiments indicated that both secreted and periplasmic β-(1,2)glucans bind iron specifically and promote growth under iron-restricted conditions. and mutants blocked in the production of β-(1,2)glucan accumulate low amounts of intracellular iron under iron-restricted conditions, whereas they exhibit elevated ROS production and sensitivity under iron-replete conditions. Our results reveal a critical role of glucan in intracellular iron homeostasis conserved in Gram-negative bacteria.