Iron is an essential cofactor, but it is also toxic at high levels. In Schizosaccharomyces pombe, the sensor glutaredoxin Grx4 guides the activity of the repressors Php4 and Fep1 to mediate a complex transcriptional response to iron deprivation: activation of Php4 and inactivation of Fep1 leads to inhibition of iron usage/storage, and to promotion of iron import, respectively. However, the molecular events ruling the activity of this double-branched pathway remained elusive. We show here that Grx4 incorporates a glutathione-containing iron-sulfur cluster, alone or forming a heterodimer with the BolA-like protein Fra2. Our genetic study demonstrates that Grx4-Fra2, but not Fep1 nor Php4, participates not only in iron starvation signaling but also in iron-related aerobic metabolism. Iron-containing Grx4 binds and inactivates the Php4 repressor; upon iron deprivation, the cluster in Grx4 is probably disassembled, the proteins dissociate, and Php4 accumulates at the nucleus and represses iron consumption genes. Fep1 is also an iron-containing protein, and the tightly bound iron is required for transcriptional repression. Our data suggest that the cluster-containing Grx4-Fra2 heterodimer constitutively binds to Fep1, and upon iron deprivation the disassembly of the iron cluster between Grx4 and Fra2 promotes reverse metal transfer from Fep1 to Grx4-Fra2, and de-repression of iron-import genes. Our genetic and biochemical study demonstrates that the glutaredoxin Grx4 independently governs the Php4 and Fep1 repressors through metal transfer. Whereas iron loss from Grx4 seems to be sufficient to release Php4 and allow its nuclear accumulation, total or partial disassembly of the Grx4-Fra2 cluster actively participates in iron-containing Fep1 activation by sequestering its iron and decreasing its interaction with promoters.