We examined time-dependent effect of iron oxide nanoparticles (IONPs) at a rate of 2000 mg kg-1 soil on Cynodon dactylon litter (3 g kg-1) decomposition in an arid sandy soil. Overall, heterotrophic cultivable bacterial and fungal colonies, and microbial biomass carbon were significantly decreased in litter-amended soil by the application of nanoparticles after 90 and 180 days of incubation. Time dependent effect of nanoparticles was significant for microbial biomass in litter-amended soil where nanoparticles decreased this variable from 27% after 90 days to 49% after 180 days. IONPs decreased CO2 emission by 28 and 30% from litter-amended soil after 90 and 180 days, respectively. These observations indicated that time-dependent effect was not significant on grass-litter carbon mineralization efficiency. Alternatively, nanoparticles application significantly reduced mineral nitrogen content in litter-amended soil in both time intervals. Therefore, nitrogen mineralization efficiency was decreased to 60% after 180 days compared to that after 90 days in nanoparticles grass-litter amended soil. These effects can be explained by the presence of labile Fe in microbial biomass after 180 days in nanoparticles amendment. Hence, our results suggest that toxicity of IONPs to soil functioning should consider before recommending their use in agro-ecosystems.