Maintaining a highly negative value of conduction band (CB) potential of photocatalysts through metal doping has been a great challenge. Herein, we investigated the effects of Fe-doping on the crystal structures and electronic structures of zirconia (ZrO2) in detail by combining experiments and Density Functional Theory (DFT). It was revealed that the Fe-doping obviously triggered the formation of tetragonal phase ZrO2 and induced a defect states in the bandgap of Fe-doped ZrO2. Due to the coherent effect between the electrons of the Fe 3d orbitals and ZrO2 intrinsic electronic states, the defect states expanded the light absorption edge of ZrO2 and Fe-doped ZrO2 showed a small bandgap with maintaining a highly negative value of the CB potential. Meanwhile, Fe-doping significantly enhanced photoelectrochemical properties, the efficiency separation of electron-hole pairs and photocatalytic activity in comparison with the pristine ZrO2. We also found that 0.5%Fe-ZrO2 exhibited the optimum photocatalytic performance, and reached 96% for degradation of Rhodamine B (RhB) within 150 min under visible light irradiation. This work elucidated the mechanism of the photocatalytic degradation of RhB over Fe-doped ZrO2 and provided a promising approach in designing highly negative CB potential of ZrO2 via Fe doping toward sustainable environmental remediation.