A systematic series of commercial α-Fe₂O₃ catalysts was investigated with respect to the after-treatment of the lean exhaust emissions of gas engines. The samples were physico-chemically characterized by X-ray diffraction, Laser Raman spectroscopy, N₂ physisorption, temperature-programmed reduction with CO and the temperature-programmed desorption of CO₂, whereas the catalytic efficiency was evaluated using a model exhaust gas. Structure–activity correlations showed that for the oxidation of CH₄ the number of active Fe sites and the availability of surface and subsurface oxygen are crucial properties of the catalysts. By contrast, the conversion of CH₂O is driven by the CO₂ adsorption capacity and the amount of OH surface species, in line with the mechanistic understanding gained by step function experiments and diffuse reflectance infrared Fourier-transform spectroscopy (DRIFTS). The in-situ DRIFTS studies suggested that the CH₂O oxidation follows a Cannizzaro-type mechanism including the reaction of two CH₂O molecules with a surface OH site to form CH₃OH and formate species. The subsequent conversion of the formate moieties with H₂O results in the reconstruction of the OH groups and the release of formic acid. The latter is assumed to decompose into CO₂ and H₂ which finally oxidizes to H₂O. The best iron oxide catalyst was upscaled to the level of a real catalytic converter, which was tested in the lean exhaust gas of a 600 kW biomethane engine. As a result, the catalyst demonstrated high activity with regard to CH₂O and CO removal above 300 and 500 °C, respectively, while only negligible conversion of CH₄ occurred.