Dehydrogenation of isobutane to isobutene was successufully carried out on iron loaded activated carbon catalyst at 873 K. Isobutane conversion of 48%, the yield of 40% and selctivity 80% were obtained with 0.3 mmol iron loaded on Ig of activated carbon, at 873 K with W/F of 25 g-cat-h/mol of isobutane. Cofeeding of carbon dioxide promoted dehydrogenation as compared to feeding bulk isobutane or isobutane and argon mixture. Hydrogen produced by dehydrogenation was transformed into water in the presence of carbon dioxide, and carbon dioxide was reduced to carbon monoxide. A redox cycle of Fe3O4 and metallic iron is suggested for the catalytic cycle in carbon dioxide by analyzing XRD and XPS. Carbon deposition was reduced under a carbon dioxide stream as compared with the reaction under argon atmosphere.