Experiments have been carried out to study the effect of temperature, gas composition, residence time, and type of iron ore pellets on formation of cementite during gaseous reduction of hematite. Industrial iron ore pellets have been reduced isothermally in a gas mixture with H 2 and CO as main components. The presence of Fe 3 C in the partially reduced pellets shows that reduction and cementite formation take place at the same time. The maximum content of cementite is identified in the samples reduced by H 2 -CO at 1123 K (850°C). The decrease in the carbide content due to addition of 1 pct CO 2 to the initial gas mixture reveals the major influence of carbon potential in the gas atmosphere. Further increase of CO 2 content increases the Fe 3 C. The variations of the amount of cementite with the CO 2 content suggest that both the thermodynamics and kinetics of cementite formation are affected by the gas composition. Cementite decomposes to graphite and iron particles in reducing and inert atmospheres as the residence time of pellets at high temperature is increased above 60 minutes.