The overwhelming application of Iron(III) oxide is as the feedstock of the steel and iron industries, e.g. the production of pure iron, steel, and many alloys.
A very fine powder of ferric oxide is known as jeweler's rouge, red rouge, or simply rouge. It is used to put the final polish on metallic jewelry and lenses, and historically as a cosmetic.
Rouge cuts more slowly than some modern polishes, such as cerium(IV) oxide, but is still used in optics fabrication and by jewelers for the superior finish it can produce. When polishing gold, the rouge slightly stains the gold, which contributes to the appearance of the finished piece. Rouge is sold as a powder, paste, laced on polishing cloths, or solid bar (with a wax or grease binder). Other polishing compounds are also often called "rouge", even when they do not contain iron oxide. Jewelers remove the residual rouge on jewelry by use of ultrasonic cleaning.
Iron(III) oxide is also used as a pigment, under names "Pigment Brown 6", "Pigment Brown 7", and "Pigment Red 101".Some of them, e.g. Pigment Red 101 and Pigment Brown 6, are Food and Drug Administration (FDA)-approved for use in cosmetics.
Nanoparticles of iron(III) oxide are biocompatible, non-toxic, are chemically active on their surface, and are paramagnetic at particle sizes above a critical limit of about 5 nanometers . They find wide use in biomedical applications. Can be used as contrast agents in magnetic resonance imaging, in labeling of cancerous tissues, magnetically controlled transport of pharmaceuticals, localized thermotherapy (where the tissue is labeled by iron oxide nanoparticles, then heated by application of AC field to particles), and preparation of ferrofluids