CO2 laser induced co-pyrolysis of toluene and iron pentacarbonyl in the presence of an ethylene sensitizer was used to produce iron-carbon nanostructures containing cementite Fe3C as the major component. The passivated Fe-C nanocomposites were characterized by several complementary analytical methods. Good agreement is found between the results of X-ray diffraction, Mossbauer spectroscopy and high-resolution transmission electron microscopy techniques which show that besides cementite, iron, and iron oxides, traces of other carbides are also present. Specific morphological aspects of the nanograins encased in a mostly disordered and quasi-amorphous carbon matrix are revealed. The simultaneous presence of rather small crystallites (mean diameter between 3–6 nm), identified as possible Fe3C/α-Fe and iron oxide (maghemite/magnetite) phases and of single-phase larger crystallites (10–13 nm mean diameter), identified as Fe3C is illustrated. Raman spectroscopy seems to confirm maghemite as the iron oxide phase present in the iron-carbon nanopowders. The level of oxidation mainly induced by powder passivation is roughly estimated by FTIR spectroscopy and leads to iron oxide contents between 11–17 wt. %. The catalytic role of iron nanoparticles in the pyrolyzed system is addressed in connection with nanocarbon samples obtained in the absence of an iron donor.