The microstructure, electrical property and gas-sensing characteristics of complex compounds in the CdO–Fe 2O 3 system have been investigated. Raw powder with Cd/Fe = 1 : 2 was prepared by chemical coprecipitation method. The results from thermal gravimetric-differential thermal analysis and X-ray diffraction measurement indicate that decomposition of CdCO 3 takes place from 350 to 500°C, and the solid reaction in CdO–Fe 2O 3 system starts at 570°C; the completion of this reaction is up to 800°C. Single phase of CdFe 2O 4 is composed of spheroidic grains with narrow size distribution between 50 and 150 nm. Sample calcined at 650°C consists of smaller grains with different shape and sizes due to the presence of three phases, i.e., CdFe 2O 4, CdO and α-Fe 2O 3. The sensors based on Cd–Fe complex oxides show a high sensitivity and selectivity to C 2H 5OH gas over CO, H 2 and i-C 4H 10. The sensor made of 650°C sample operates at 380°C, and its sensitivity to 200 ppm C 2H 5OH gas is up to 90, but its sensitivity to 1000 ppm H 2, CO or i-C 4H 10 are only 7.5, 4 and 5, respectively.