We employed induced pluripotent stem cell (iPSC)-derived neurons obtained from Friedreich ataxia (FRDA) patients and healthy subjects, FRDA neurons and CT neurons, respectively, to unveil phenotypic alterations related to frataxin (FXN) deficiency and investigate if they can be reversed by treatments that upregulate FXN. FRDA and control iPSCs were equally capable of differentiating into a neuronal or astrocytic phenotype. FRDA neurons showed lower levels of iron–sulfur (Fe–S) and lipoic acid-containing proteins, higher labile iron pool (LIP), higher expression of mitochondrial superoxide dismutase (SOD2), increased reactive oxygen species (ROS) and lower reduced glutathione (GSH) levels, and enhanced sensitivity to oxidants compared with CT neurons, indicating deficient Fe–S cluster biogenesis, altered iron metabolism, and oxidative stress. Treatment with the benzamide HDAC inhibitor 109 significantly upregulated FXN expression and increased Fe–S and lipoic acid-containing protein levels, downregulated SOD2 levels, normalized LIP and ROS levels, and almost fully protected FRDA neurons from oxidative stress-mediated cell death. Our findings suggest that correction of FXN deficiency may not only stop disease progression, but also lead to clinical improvement by rescuing still surviving, but dysfunctional neurons.