The interactions between the polysaccharide alginate and iron(III) were investigated. The solution properties were studied through pH-metry, viscometry, zeta potential and particle size measurements. In the presence of alginate, iron(III) was stabilized and no precipitation was observed. Studies indicate that iron(III)-alginate system was more stable than iron(III) or alginate alone. The binding constant is of the order of 10(4) M(-1). A case for 'site binding model' for the interaction between alginate and Fe(III) has been made based on the studies using circular dichroism and zeta potential experiments. The number of binding sites per molecule of alginate has been estimated to be 66. This indicates that the alginate can bind more number of Fe(III) ions and thus provide a stable complex which can find wide industrial applications.