Iron is generally removed from groundwater by the process of aeration or chemical oxidation followed by rapid sand filtration. Different mechanisms (physicochemical and biological) may contribute to iron removal in filters but the dominant mechanism depends on the physical and chemical characteristics of the water and process conditions applied. Nowadays, there are increasing numbers of publications on methods of biological iron removal which are reported to be much more efficient and cost effective than conventional physicochemical iron removal. However, the biological iron removal mechanism is not fully understood and there are still controversies about whether the mechanism of iron removal in filters could be solely biological or whether the presence of iron oxidising bacteria supplements the physicochemical iron removal mechanisms under certain specific conditions. This paper reviews the theoretical background of biologically mediated iron removal, the process conditions required, the advantages and limitations of the method and a few case studies. A literature review revealed that biological iron removal is not suitable when pH and oxygen concentrations are high and/or NH4+, H2S and Zn are present. Physicochemical removal mechanisms can achieve the same removal efficiency under the conditions that are reported to be favourable for biological iron removal. Biological iron removal is likely to be supplementary to conventional physicochemical iron removal.