Abstract Fe-doped ZnO nanoparticles (NPs) with different Fe contents (0.1–5.0 wt%) were prepared using extract of wild olive leaves growing in Saudi Arabia (region of Abha). The biosynthesized NPs were characterized by Fourier transform infrared spectroscopy, X-ray diffraction, Brunauer–Emmett–Teller, scanning electron microscopy, transmission electron microscopy, and photoluminescence (PL). Characterization results showed that undoped ZnO and Fe-doped ZnO powders were crystallized in the wurtzite structure with a small shift for the doped samples. Neither Fe3O4 nor another iron oxide phase was observed in the samples, which proves the incorporation of Fe into the ZnO lattice. Doping has a pronounced effect on the physical and optical properties. Indeed, the size of the crystallites, the energy of the bandgap as well as the intensity of the PL emission decreased with the Fe content. Photocatalytic tests revealed that the doped samples degraded methyl orange (MO) more efficiently than pure ZnO and pure Fe3O4. Moreover, the photocatalytic activity improved with increasing Fe content. The best photocatalyst of the series (Fe–ZnO-5) was found degrading MO by 92.1%, in 90 min in a pseudo-first order reaction.