Limonite, a low-cost iron ore, was investigated as a potential hydrotreatment catalyst for kraft lignin without the use of an external solvent (batch reactor, initial H₂ pressure of 100 bar, 4 h). The best results were obtained at 450 °C resulting in 34 wt % of liquefied kraft lignin (lignin oil) on lignin intake. The composition of the lignin oil was determined in detail (elemental composition, GC-MS, GC×GC-FID, and GPC). The total GC-detectable monomeric species amounts up to 31 wt % on lignin intake, indicating that 92 wt % of the products in the lignin oil are volatile and thus of low molecular weight. The lignin oil was rich in low-molecular-weight alkylphenolics (17 wt % on lignin) and aromatics (8 wt % on lignin). Performance of the limonite catalyst was compared to other Fe-based catalysts (goethite and iron disulfide) and limonite was shown to give the highest yields of alkylphenolics and aromatics. The limonite catalyst before and after reaction was characterized using XRD, TEM, and nitrogen physisorption to determine changes in structure during reaction. Catalyst recycling tests were performed and show that the catalyst is active after reuse, despite the fact that the morphology changed and that the surface area of the catalyst particles was decreased. Our results clearly reveal that cheap limonite catalysts have the potential to be used for the depolymerization/hydrodeoxygenation of kraft lignin for the production of valuable biobased phenolics and aromatics.