Iron-based catalysts were developed to achieve the hydrodechlorination (HDC)/oxidation of polychlorinated biphenyls (PCBs) from thermal desorption off-gas, and Fe3O4/γ-Al2O3 showed higher dechlorination efficiency than Fe2O3/γ-Al2O3. The optimal Fe loading resulted in 95.5% degradation efficiency and 76.9% toxicity reduction of gaseous PCBs, and the optimal Fe3O4/γ-Al2O3 exhibited excellent stability during a 60-h test. The gas chromatography–mass spectrometry analysis of intermediate products indicated the presence of two competitive degradation pathways, namely, hydrodechlorination and oxidation with Fe3O4/γ-Al2O3 as catalyst. During the first stage (reductive dechlorination), the reductive activity of iron-based catalysts was effectively enhanced in the presence of water, which was confirmed by density functional theory (DFT) calculations. The removal of chlorine atoms was found in the order of meta > para > ortho. During the second stage (oxidation), hydroxyl and superoxide anion radicals were found to attack PCBs on the surface of Fe3O4/γ-Al2O3. This study provides an insight into the HDC and oxidation mechanism of gaseous PCBs over iron-based catalysts.