The isothermal oxidation of an AISI 1005 steel (mild steel) in water vapour and CO2 mixtures containing environments resulted from ethanol combustion had been investigated for exposure times ranging from 1 hour to 49 hours at elevated temperatures (700 °C, 750 °C and 800 °C). The steel was also oxidized in dry air for comparison. In water vapour and CO2 environments, mild steel underwent a significant degradation in term of the oxidation kinetics compared with those of steel oxidized in dry air environment. This finding is supported by a lower activation energy for steel oxidized in ethanol combustion products (199 kJ/mol) than that of for steel oxidized in dry air (224 kJ/mol). In addition, the breakaway oxidation was found for the steel subjected to ethanol combustion products at 800 °C. The carbon deposited in the magnetite layer was believed to lead the breakaway oxidation after an exposure time for 4 hours. A typical iron oxide growing on steel oxidized in ethanol combustion product is a pyramidal grain structures with compact scale but in dry air environment the iron rich oxide growing on the steel surface is a wrinkle characteristic displaying hollow structures at 700 °C and rough-grained oxide structures at 750-800 °C.