A survey of hot, acid springs in Yellowstone Park [USA] showed that high concentrations of ferrous and ferric Fe are often present. Total ionic Fe concentrations in different springs ranged from less than 1 ppm to greater than 200 ppm, and up to 50% of the ionic Fe was in the ferrous form. Some of these springs also have high concentrations of reduced S species (S2- and S0). Significant populations of the bacterium Sulfolobus acidocaldarius, an autotrophic organism able to live and oxidize S compounds at low pH and high temperature, were present in most of these springs. The role of this organism in the oxidation of ferrous Fe was investigated by incubating natural samples of water and assaying for disappearance of ferrous Fe. Controls in which bacterial activity was inhibited by addition of 10% NaCl were also run. Bacterial oxidation of ferrous Fe occurred in most but not all of the spring waters. The temperature optimum for oxidation varied from spring to spring, but significant oxidation occurred at temperatures of 80-85.degree. C, but not at 90.degree. C. Thus, 85-90.degree. C is the upper temperature at which bacterial Fe oxidation occurs; a similar upper limit was previously reported for S oxidation in the same kinds of springs. The steady-state concentrations of ferrous and ferric Fe are determined by the rate at which these ions move into the spring pools with the ground water (flow rate), by the rate at which ferric Fe is reduced to the ferrous state by sulfide and by the rate of bacterial oxidation. The bacterial oxidation rate is faster than the flow rate, so that the rate of reduction of ferric Fe is probably the rate-controlling reaction. In several springs, no decrease in ferrous Fe occurred, even though high bacterial populations were present. In these springs, ferrous Fe oxidation occurred but the ferric Fe formed was reduced back to the ferrous state again. These springs were all high in suspended sediment and the reductant was shown to be present in the sediment. X-ray diffraction revealed that the sediment contained 3 major ingredients, elemental S, natroalunite and quartz. Chemical analyses showed a small amount of sulfide, too little to reduce the ferric Fe. Elemental S itself did not reduce ferric Fe but when elemental S was removed from the sediment by CS2 extraction, the activity of the sediment was abolished. The sulfide present in the sediment (possibly bound to natroalunite) apparently reacts with elemental S to form a reductant for ferric Fe. Bacteria can have a profound influence on the ferrous/ferric ratios of geothermal systems, but temperature and mineral composition of the water may significantly influence the overall result.