Iron and nickel are known active sites in the enzyme carbon monoxide dehydrogenases which catalyzes CO2 to CO reversibly. The presence of nickel impurities in the earth abundant iron surface could provide a more efficient catalyst for CO2 degradation into CO, which is a feedstock for hydrocarbon fuel production. In the present study, we have employed spin-polarized dispersion-corrected density functional theory calculations within the generalized gradient approximation to elucidate the active sites on Fe (100)-Ni bimetals. We sort to ascertain the mechanism of CO2 dissociation to carbon monoxide on Ni deposited and alloyed surfaces at 0.25, 0.50 and 1 monolayer (ML) impurity concentrations. CO2 and (CO + O) bind exothermically i.e., − 0.87 eV and − 1.51 eV respectively to the bare Fe (100) surface with a decomposition barrier of 0.53 eV. The presence of nickel generally lowers the amount of charge transferred to CO2 moiety. Generally, the binding strengths of CO2 were reduced on the modified surfaces and the extent of its activation was lowered. The barriers for CO2 dissociation increased mainly upon introduction of Ni impurities which is undesired. However, the 0.5 ML deposited (FeNi0.5(A)) surface is promising for CO2 decomposition, providing a lower energy barrier (of 0.32 eV) than the pristine Fe (100) surface. This active 1-dimensional defective FeNi0.5(A) surface provides a stepped surface and Ni–Ni bridge binding site for CO2 on Fe (100). Ni–Ni bridge site on Fe (100) is more effective for both CO2 binding or sequestration and dissociation compared to the stepped surface providing the Fe–Ni bridge binding site.