Copper-containing intrauterine devices (Cu-IUD) are adopted by worldwide women for contraception with the advantages of long-term effectiveness, reversibility and affordability. However, adverse effects occur in the initial implantation stage of Cu-IUD in uterine because of the burst release of Cu2+. To minimize the burst release, in this study, we designed a series of Cu–Fe alloys with 0.5 wt%, 1 wt% and 5 wt% Fe and also further produced ultrafine grained (UFG) structure for these alloys via equal-channel angular pressing. The microstructures and properties of the coarse grained (CG) Cu, CG Cu–Fe alloys and UFG Cu–Fe alloys were systematically investigated, including grain structure and phase compositions, metallic ions release behavior, electrochemical corrosion performance, and in vitro cytotoxicity. With careful comparison and selection, we chose the CG Cu–5Fe and UFG Cu–5Fe for in vivo tests using rat model, including tissue biocompatibility, in vivo corrosion behavior, and contraceptive effectiveness. Moreover, the corrosion mechanism of the Cu–5Fe alloy and its improved biocompatibility was discussed. Both CG and UFG Cu–5Fe alloys exhibited dramatic suppression of Cu2+ release in simulated uterine fluid for the long-term immersion process. The in vivo tissue compatibility was significantly improved with both CG and UFG Cu–5Fe alloys implanted in the rats’ uterine while the high contraceptive efficacy was well maintained. Due to the superior biocompatibility, the CG and UFG Cu–5Fe alloys can be the promising candidate material for Cu-IUD. Statement of significanceA highly biocompatible Cu–Fe alloy was designed and fabricated for Cu-containing intrauterine devices (Cu-IUD). With 5 wt% Fe, the burst release of Cu2+ is inhibited due to the formed galvanic cell of Cu and Fe, resulting in earlier release of Fe3+. As Fe is the most abundant essential trace element of human body, it can mitigate the toxic effects of Cu2+, thus significantly improving both in vitro cell compatibility and in vivo tissue compatibility. More importantly, the Cu–5Fe alloy exhibits 100 % contraceptive efficiency as the CG Cu, but with greatly reduced adverse effects to the uterus tissues. An advanced Cu-IUD can be developed using Cu–Fe alloys.