Effective methane utilization for either clean power generation or value-added chemical production has been a subject of growing attention worldwide for decades, yet challenges persist mostly in relation to methane activation under mild conditions. Here, we report hematite, an earth-abundant material, to be highly effective and thermally stable to catalyze methane combustion at low temperatures (<500 °C) with a low light-off temperature of 230 °C and 100% selectivity to CO2. The reported performance is impressive and comparable to those of precious-metal-based catalysts, with a low apparent activation energy of 17.60 kcal·mol-1. Our theoretical analysis shows that the excellent performance stems from a tetra-iron center with an antiferromagnetically coupled iron dimer on the hematite (110) surface, analogous to that of the methanotroph enzyme methane monooxygenase that activates methane at ambient conditions in nature. Isotopic oxygen tracer experiments support a Mars van Krevelen redox mechanism where CH4 is activated by reaction with a hematite surface oxygen first, followed by a catalytic cycle through a molecular-dioxygen-assisted pathway. Surface studies with in situ diffuse reflectance infrared Fourier transform spectroscopy (DRIFTS) and density functional theory (DFT) calculations reveal the evolution of reaction intermediates from a methoxy CH3-O-Fe, to a bridging bidentate formate b-HCOO-Fe, to a monodentate formate m-HCOO-Fe, before CO2 is eventually formed via a combination of thermal hydrogen-atom transfer (HAT) and proton-coupled electron transfer (PCET) processes. The elucidation of the reaction mechanism and the intermediate evolutionary profile may allow future development of catalytic syntheses of oxygenated products from CH4 in gas-phase heterogeneous catalysis.