In hereditary hemochromatosis, mutations in HFE lead to iron overload through abnormally low levels of hepcidin. In addition, HFE potentially modulates cellular iron uptake by interacting with transferrin receptor, a crucial protein during erythropoiesis. However, the role of HFE in this process was never explored. We hypothesize that HFE modulates erythropoiesis by affecting dietary iron absorption and erythroid iron intake. To investigate this, we used Hfe-KO mice in conditions of altered dietary iron and erythropoiesis. We show that Hfe-KO mice can overcome phlebotomy-induced anemia more rapidly than wild-type mice (even when iron loaded). Second, we evaluated mice combining the hemochromatosis and β-thalassemia phenotypes. Our results suggest that lack of Hfe is advantageous in conditions of increased erythropoietic activity because of augmented iron mobilization driven by deficient hepcidin response. Lastly, we demonstrate that Hfe is expressed in erythroid cells and impairs iron uptake, whereas its absence exclusively from the hematopoietic compartment is sufficient to accelerate recovery from phlebotomy. In summary, we demonstrate that Hfe influences erythropoiesis by 2 distinct mechanisms: limiting hepcidin expression under conditions of simultaneous iron overload and stress erythropoiesis, and impairing transferrin-bound iron uptake by erythroid cells. Moreover, our results provide novel suggestions to improve the treatment of hemochromatosis.