Encapsulating a solid carbon source and zero-valent iron (ZVI) within a hydrogel can prevent direct contact with groundwater, thereby extending the lifespan of their released active substrates. It is currently unclear whether the solid carbon source and ZVI will mutually influence each other's active substrate release process and the corresponding denitrification patterns, necessitating further investigation. In this study a hydrogel encapsulating different weight ratios of micron-sized zero-valent iron (mZVI, as ZVI) and polyhydroxybutyrate (PHB, as a solid carbon source) was synthesized. The aim was to investigate the influence of PHB on the release of dissolved iron from mZVI and denitrification mechanism. Results indicated that PHB was consumed at a higher rate than mZVI, and more mZVI active sites could be exposed after PHB consumption. Meanwhile, PHB increased the porosity of the hydrogel, allowing more active sites of mZVI to be exposed and thus releasing more dissolved iron. Furthermore, PHB enhanced the rate of microbial corrosion of mZVI, which further increased the release of dissolved iron. Higher PHB content in the hydrogel reduced the oxidation of the released dissolved iron, resulting in a microbial community dominated by heterotrophic microorganisms. Conversely, lower PHB content led to significant Fe(II) oxidation and a considerable relative abundance of mixotrophic microorganisms in the microbial community. Microorganisms with iron reduction potential were also detected. This study provides theoretical support for the precise control of mixed nutrient denitrification based on hydrogel immobilization and lays the foundation for its further practical application in groundwater.