Recent works on the effect of iron catalyst on direct coal liquefaction reaction were reviewed from catalytic point of view. Various types of iron compounds such as sulfides, oxides and metallic iron are effective for coal dissolution step, because they enhance the hydrogen donating property of solvent by hydrogenating aromatic nucleus. As well, iron catalysts play an important role in coal liquefaction by hydrocracking and hydrodesulfurizing coal fragments. The most effective form of iron catalyst at the working state in coal liquefaction was discussed.