Metal nanoparticles play an outstanding role in the field of wound healing due to their excellent properties, and the significance of iron, one of the most widely used metals globally, cannot be overlooked. The purpose of this review is to determine the importance of iron nanoparticles in wound-healing dressings. Prolonged, poorly healing wounds may induce infections; wound infections are a major cause of chronic wound formation. The primary components of iron nanoparticles are iron oxide nanoparticles, which promote wound healing by being antibacterial, releasing metal ions, and overcoming bacterial resistance. The diameter of iron oxide nanoparticles typically ranges between 1 and 100 nm. Magnetic nanoparticles with a diameter of less than 30 nm are superparamagnetic and are referred to as superparamagnetic iron oxide nanoparticles. This subset of iron oxide nanoparticles can use an external magnetic field for novel functions such as magnetization and functionalization. Iron nanoparticles can serve clinical purposes not only to enhance wound healing through the aforementioned means but also to ameliorate anemia and glucose irregularities, capitalizing on iron’s properties. Iron nanoparticles positively impact the healing process of chronic wounds, potentially extending beyond wound management.