This paper reports a promising route of solar fuels production via two-step thermochemical cycle based on Fe3O4/Fe with CH4 reduction, which has low reduction temperature and high fuel selectivity. The influences of equilibrium compositions and reactant ratios on the thermodynamic properties of thermochemical cycle, fuel energy upgradation and energy conversion efficiency are studied based on second law of thermodynamics. The calculated results indicate that the introduced CH4 lowers the reduction temperature T-red, and n(CH4):n(Fe3)(O4 )= 4 and 960 K <= T-red <= 1600 K are conductive to produce more solar fuels with higher purity. Also, we find that Fe3O4 is incompletely recovered during water-splitting step at n(Fe):n(H2O) = 0.75, whereas, more water input contributes to the recovery of Fe3O4 but lowers energy conversion efficiencies. Moreover, the recovery degree of Fe3O4 has little impact on the efficiency improvement of the subsequent thermochemical cycles. The cycle stability was studied by comparing solar to fuel efficiency of the first and the subsequent cycles, indicating the proposed system has good cycle stability. The two-step cycle based on Fe3O4/Fe to produce solar fuels with CH4 reduction at n(CH4):n(Fe3O4) = 4 in reduction step and n(Fe):n(H2O) = 0.75 in water splitting step is proposed as a feasible and industrially-advantageous route for solar fuels production with high fuel selectivity and efficiency.