Developing an efficient material as a counter electrode (CE) with excellent catalytic activity, intrinsic stability, and low cost is essential for the commercial application of dye-sensitized solar cells (DSSCs). Transition metal phosphides have been demonstrated as outstanding multifunctional catalysts in a broad range of energy conversion technologies. Here, we exploited different phases of iron phosphide as CEs in DSSCs with an I^–/I₃^–-based electrolyte. Solvothermal synthesis using a triphenylphosphine precursor as a phosphorus source allows to grow a Fe₂P phase at 300 °C and a FeP phase at 350 °C. The obtained iron phosphide catalysts were coated on fluorine-doped tin oxide substrates and heat-treated at 450 °C under an inert gas atmosphere. The solar-to-current conversion efficiency of the solar cells assembled with the Fe₂P material reached 3.96 ± 0.06%, which is comparable to the device assembled with a platinum (Pt) CE. DFT calculations support the experimental observations and explain the fundamental origin behind the improved performance of Fe₂P compared to FeP. These results indicate that the Fe₂P catalyst exhibits excellent performance along with desired stability to be deployed as an efficient Pt-free alternative in DSSCs.