Magnesium oxide crystals implanted with ${}_{}{}^{57}{}_{}{}^{}\mathrm{Fe}_{}^{+}{}_{}{}^{}$ ions at doses ranging from ${10}^{15}$ to ${10}^{17}$ ions/${\mathrm{cm}}^2$ (ion energy 70, 100, and 150 keV) were studied with the conversion-electron Mössbauer-spectroscopy technique. Supplementary data were obtained using the techniques of Rutherford backscattering and channeling of $\alpha$ particles, optical absorption, electron microscopy, and electrical conductivity. It was found that implantation introduces iron in MgO in three charge states: ${\mathrm{Fe}}^{2+}$, ${\mathrm{Fe}}^{3+}$, and metallic precipitates (${\mathrm{Fe}}^0$) with the dominant role of ${\mathrm{Fe}}^{3+}$ at low doses, ${\mathrm{Fe}}^{2+}$ at medium doses, and metallic iron clusters at the highest doses. The phase created in a medium range of doses can be compared with the magnesio-wüstite solid solution. The isochronal thermal annealings in air at temperatures between 300 and 700°C gradually cause the oxidation and the nucleation of highly dispersed spinel-like clusters and then, at about 800-900°C, the growth of magnesioferrite particles. In contrast, the heat treatment in vacuum converts all iron into well-diluted ${\mathrm{Fe}}^{2+}$ in MgO phase. The nature of point defects and their role in annealing processes are discussed on the basis of the optical absorption data. A good correspondence between the results of Mössbauer and channeling data is indicated. The effect of the insulator-conductor transition occurring under iron-ion implantation in MgO and observed by electrical conductivity measurements is explained in terms of the atomistic properties of implanted crystals under study.