This study investigated reductive transformation of iodine by zero-valent iron (ZVI), and the subsequent detoxification of iodine-laden wastewater. ZVI completely reduced aqueous iodine to non-toxic iodide. Respirometric bioassay illustrated that the presence of iodine increase the lag phase before the onset of oxygen consumption. The length of lag phase was proportional to increasing iodine dosage. The reduction products of iodine by ZVI did not exhibit any inhibitory effect on the biodegradation. The cumulative biological oxidation associated with iodine toxicity was closely fitted to Gompertz model. When iodine-laden wastewater was continuously fed to a bench-scale activated sludge unit, chemical oxygen demand (COD) removal efficiencies decreased from above 90% to below 80% along with a marked decrease in biomass concentration. On the other hand, the COD removal efficiency and biomass concentration remained constant in the integrated ZVI-activated sludge system. Respirometric bioassay with real iodine-laden LCD manufacturing wastewater demonstrated that ZVI was effective for detoxifying iodine and consequently enhancing biodegradability of wastewater. This result suggested that ZVI pretreatment may be a feasible option for the removal of iodine in LCD processing wastewater, instead of more costly processes such as adsorption and chemical oxidation, which are commonly in the iodine-laden LCD wastewater treatment facility.