The iron redox cycle can enhance anammox in treating low-strength ammonia wastewater. However, maintaining an effective iron redox cycle and suppressing nitrite-oxidizing bacteria in a one-stage partial nitritation and anammox (PN/A) process poses challenges during long-term aeration. We proposed a novel and simple strategy to achieve an efficient iron redox cycle in an iron-mediated anoxic-microaerobic (A/O) process by controlling organic matter (OM) at medium-strength levels (30–110 mg COD/L) in microaerobic granular sludge (MGS)-dominated reactor. The developed A/O process consistently achieved >90 % OM removal and >75 % nitrogen removal. Medium-strength OM varied the penetration depths of dissolved oxygen (DO) in MGS, regulating redox conditions and promoting redox reactions across MGS layers, thus activating accumulated inert iron oxides. Ammonia-oxidizing bacteria (Nitrosomonas), iron-reducing bacteria (e.g., Ignavibacterium, Geobacter), and anammox bacteria (Ca. Kuenenia) coexisted harmoniously in MGS. This coexistence ensured high anammox and Feammox rates along with a robust iron redox cycle, thereby mitigating the adverse impacts of fluctuating DO and OM on one-stage PN/A process stability. The identification of iron reduction-associated genes within Ca. Kuenenia, Ignavibacterium, and Geobacter suggests their potential roles in supporting Feammox coupled in one-stage PN/A process. This study introduces an iron-cycle-driven A/O process as an energy-efficient alternative for simultaneous carbon and nitrogen removal from low-strength wastewater.