Spectroscopically following charge carrier dynamics in catalytic materials has proven to be a difficult task due to the ultrafast timescales involved in charge trapping and the lack of spectroscopic tools available to selectively probe surface electronic structure. Transient extreme ultraviolet reflection-absorption (XUV-RA) spectroscopy is able to follow surface electron dynamics due to its element, oxidation-state, and surface specificity, as well as the ultrafast time-resolution which can be achieved with XUV pulses produced by high harmonic generation. Here, we use ultrafast XUV-RA spectroscopy to show that charge localization and small polaron formation in Fe2O3 occur within ∼660 fs. The photoexcitation of hematite at 400 nm initially leads to an electronically-delocalized ligand-to-metal charge transfer (LMCT) state, which subsequently evolves into a surface localized LMCT state. Comparison of the charge carrier dynamics for single and polycrystalline samples shows that the observed dynamics are negligibly influenced by grain boundaries and surface defects. Rather, correlation between experimental results and spectral simulations reveals that the lattice expansion during small polaron formation occurs on the identical time scale as surface trapping and represents the probable driving force for sub-ps electron localization to the hematite surface.