A magnetically recoverable composite mercury removal sorbent was produced by introducing magnetic gamma-Fe2O3 into attapulgite (ATT) (xFe1ATT) via the co-precipitation method and used to remove Hg-0 in the simulated coal-fired power plant flue gas. The as-prepared 0.5Fe1ATT sorbent was characterized by X-ray diffraction, Brunauer-Emmett-Teller, transmission electron microscopy, vibrating sample magnetometer, X-ray photoelectron spectroscopy, and Fourier transform infrared spectroscopy analyses. The results showed that the Hg-0 removal performance of the composite of gamma-Fe2O3 and ATT was significantly promoted in comparison to pure gamma-Fe2O3 and ATT individually. A relatively high magnetization value and good Hg-0 removal performance were obtained by the sample of 0.5Fe1ATT. O-2 could enhance Hg-0 removal activity via the Mars-Maessen mechanism. NO displayed a significant promotion effect on Hg-0 removal as a result of the formation of active species, such as NO2 and NO+. SO2 inhibited the removal of Hg-0 as a result of its competition adsorption against Hg-0 for the active sites and the sulfation of the sorbent. However, the introduction of NO could obviously alleviate the adverse effect of SO2 on the Hg-0 removal capability. H2O showed a prohibitive effect on Hg-0 removal as a result of its competition with Hg-0 for the active sites. The findings of this study are of fundamental importance to the development of efficient and economic magnetic mercury sorbents for Hg-0 removal from coal-fired boiler flue gases.