Iron alloys, including steel and magnetic functional materials, are widely used in capital construction, manufacturing, electromagnetic technology, etc. However, they face the long-standing challenge of high coefficient of thermal expansion (CTE), limiting the applications in high-precision fields. This work proposes a general strategy involving the in-situ formation of a nano-scale lamellar/labyrinthine negative thermal expansion (NTE) phase within the iron matrix to tackle this problem. For example, a model Fe alloy, Fe-Zr10-Nb6, was synthesized and its CTE is reduced to approximately half of the iron. Meanwhile, the alloy possesses an excellent strength-plasticity combination of 1.5 GPa (compressive strength) and 17.5% (ultimate strain), which outperforms other low thermal expansion (LTE) metallic materials. The magnetovolume effect of the NTE phase is deemed to counteract the positive thermal expansion in iron. The high stress-carrying hard NTE phase and the tough matrix synergistically contribute to the superior mechanical properties. The interaction between the slip of lamellar microstructure and the slip-hindering of labyrinthine microstructure further enhances the strength-plasticity combination. This work shows the promise of offering a universal method to produce LTE iron alloys with outstanding mechanical properties.