Understanding and modulating the dynamic structural evolution is of great significance in developing high-performance heterogeneous catalysts. This work investigates the effect of potassium (K) promoter on the carburization and oxidation of Fe phases during CO2 hydrogenation over an iron-based catalyst using in-situ X-ray diffraction, in-situ infrared spectroscopy, and temperature-programmed techniques. The addition of K enhances CO2 adsorption of the catalyst, promotes the reaction of CO2 with the dissociated hydrogen, and accelerates the carburization of Fe(0) to Fe3C and then to Fe5C2. In addition to impacting the reactive microenvironment of the catalyst surface on the competitive adsorption and reactions, the addition of K also prevents the active Fe5C2 phase from oxidation during CO2 hydrogenation. With an optimized content of K and CO pretreatment, the iron-based catalysts were endowed with high catalytic activity for CO2 conversion to C2-C4 olefins and C5+ long-chain hydrocarbons. This work provides insight into the correlation between the reactive microenvironment and the structural evolution of Fe catalysts doped with K promoter and shall be beneficial for future development of new catalytic materials for CO2 hydrogenation, and possibly other reactions.