The purification of indoor air is a crucial application of photocatalysis, emphasizing the urgent need for more efficient photocatalytic systems. While photocatalytic oxidation of volatile organic compounds (VOCs) has been extensively studied in the liquid phase, effective removal of VOCs in the gaseous state in indoor air remains a significant challenge. This study focuses on the continuous gas-phase oxidation of gaseous acetaldehyde using ZnO and different weight percentage of Fe-grafted ZnO catalysts under light irradiation. The surface analysis using XPS and HR-TEM confirmed the presence of Fe(III) species, and UV–Vis-DRS analysis demonstrated a shift in the absorption edge towards the visible region. Real-time gas FTIR monitoring of acetaldehyde oxidation revealed that the 0.7% Fe(III)-grafted ZnO composite catalyst achieved a higher removal efficiency (74%) compared to bare ZnO and other Fe(III)-grafted ZnO ratios. The enhanced photocatalytic efficiency of acetaldehyde by Fe(III)-grafted ZnO supports indicated direct interfacial charge transfer (IFCT) from ZnO to Fe(III) species. Additionally, the Fe(III) cluster effectively improved the separation of electrons and holes, preventing their recombination and accelerating O₂ activation to generate O₂•⁻ radicals, which lead to high photocatalytic performance. The 0.7% Fe(III)-grafted ZnO also maintained its performance over a prolonged period of 360 min, showing excellent structural stability and durability across multiple cycles. This study highlights the possible synergistic effect of the ZnO and Fe systems, offering a new perspective on the photocatalytic decomposition of gaseous acetaldehyde in indoor environments.