The competitive adsorption and reaction mechanism for the catalytic hydrolysis of carbonyl sulphide (COS) and carbon disulphide (CS2) over Fe2O3 cluster was investigated. Compared with experimental results, the theoretical study was used to further investigate the competitive adsorption and effect of H2S in the hydrolysis reaction of COS and CS2. Experimental results showed that Fe2O3 cluster enhanced the catalytic hydrolysis effect. Meanwhile, H2S was not conducive to the hydrolysis of COS and CS2. Theoretical calculations indicated that the order of competitive adsorption on Fe2O3 is as follows: H2O (strong) >CS2 (medium) >COS (weak). In the hydrolysis process, the C=S bond cleavage occurs easier than C=O bond cleavage. The hydrolysis reaction is initiated via the migration of an H-atom, which triggers C=S bond cleavage and S-H bond formation. Additionally, we find the first step of CS2 hydrolysis to be rate limiting. The presence of H2S increases the reaction energy barrier, which is not favourable for COS hydrolysis. Fe2O3 can greatly decrease the maximum energy barrier, which decreases the minimum energy required for hydrolysis, making it relatively facile to occur. In general, the theoretical results were consistent with experimental results, which proved that the theoretical study was reliable.