Photocatalytic activity of α-Fe2O3 under visible light had been studied intensively. Rapid electron-hole recombination is the main drawback of α-Fe2O3 and the photocatalytic activity can be enhanced by transition metal doping and heterojunction structure. In the present study, α-Fe2O3 doped with various amounts of Nb were synthesized using a simple sol–gel method, and further characterization and catalytic activity were investigated. PXRD, TEM-EDS and Mössbauer measurement showed the formation of weak-ferromagnetic Nb-doped α-Fe2O3 and FeNbO4, where heterojunction structure was suggested. UV–vis spectrum showed a broad absorption in visible-light regions with a narrow band gap between 2.27 and 2.97 eV. Photo-Fenton reaction using α-Fe2O3 to decompose methylene blue (MB) was conducted to evaluate the catalytic activity. Nb-doped sample showed a significant improvement compared with pure α-Fe2O3. PXRD and Mössbauer spectroscopy revealed the α-Fe2O3 and FeNbO4 phases, which were attached to a magnet due to the ferrimagentic character of Nb-doped α-Fe2O3. The high catalytic activity with k value 7.1 * 10−2/min was obtained for 7.4Nb600. Higher catalytic activity was also observed for 20Nb600 and 40Nb600, which were driven by higher surface area, Nb substitution and heterojunction structure. Mechanistic analysis revealed that the primary reaction of MB decomposition is the Photo-Fenton process.