Iron regulatory proteins (IRP1 and 2) function as translational regulators that coordinate the cellular iron metabolism of eukaryotes by binding to the mRNA of target genes such as the transferrin receptor or ferritin. In addition to IRP2, IRP1 serves as sensor of reactive oxygen species (ROS). As iron and oxygen are essential but potentially toxic constituents of most organisms, ROS-mediated modulation of IRP1 activity may be an important regulatory element in dissecting iron homeostasis and oxidative stress. The responses of IRP1 towards reactive oxygen species are compartment-specific and rather complex: H2O2 activates IRP1 via a signaling cascade that leads to upregulation of the transferrin receptor and cellular iron accumulation. Contrary, superoxide inactivates IRP1 by a direct chemical attack being limited to the intracellular compartment. In particular, activation of IRP1 by H2O2 has established a new regulatory link between inflammation and iron metabolism with new clinical implications. This mechanism seems to contribute to the anemia of chronic disease and inflammation-mediated iron accumulation in tissues. In addition, the cytotoxic side effects of redox-cycling anticancer drugs such as doxorubicin may involve H2O2-mediated IRP1 activation. These molecular insights open up new therapeutic strategies for the clinical management of chronic inflammation and drug-mediated cardiotoxicity.