The pharmaceutical compound, acetaminophen (ACT), is considered an environmental contaminant of emerging concern due to its persistent and bioaccumulation as well as toxicity towards human health and aquatic life. Conventional wastewater treatment processes are ineffective in the removal of ACT; thus, advanced oxidation processes (AOPs) are required. The heterogeneous photocatalysis process based on TiO2 semiconductor presents an effective route for the degradation of various pharmaceuticals. In this sense, Fe2O3-TiO2 nanocomposites were synthesized via the sol-gel method and characterized via XRD, N2 physisorption, FE-SEM, EDX, UV–vis DRS, TEM, XPS, and FT-IR. The results showed that the incorporation of 5 wt% Fe2O3 has significantly increased the BET surface area, reduced particle size, stabilized the anatase phase, enhanced the optical properties of Fe2O3-TiO2 by a redshift to longer wavelength (visible light), and reduced the bandgap to 1.6 eV. The XPS results confirmed the presence of T4+ and Fe3+ in the synthesized nanocomposite., while TEM images confirmed the reduction in particle size. The photocatalytic degradation of ACT was further optimized by the response surface method based on Face-centered central composite design. Results revealed that the highest removal rate of ACT was observed at alkaline (pH 11) conditions, initial concentration of ACT of 30 mg/L, and catalyst loading of 1.25 g/L.