The invention particularly relates to a dephosphorization and iron-increasing method of high phosphorus hematite by direct reduction, and the technical scheme comprises the following steps: mixing 60-83wt% of high phosphorus hematite powder, 10-15wt% of carbonaceous reducing agent, 6-15wt% of quicklime and 1-10wt% of additive uniformly, pressing the mixture into blocks, drying, reducing in a high temperature furnace under 1250-1350 DEG C, and keeping the temperature for 15-30 minutes; carrying out furnace cooling until the temperature is 600-800 DEG C, taking the reduction product out, naturally cooling, grinding and performing the magnetic separation to obtain pig iron particles. The additive is sodium carbonate, or potassium carbonate, or the mixture of the sodium carbonate and the potassium carbonate; drying is carried out under the condition of 110-120 DEG C until the weight of the mixture of raw materials is constant; and the high temperature furnace is a resistance furnace, or a rotary kiln, or a rotary hearth furnace, and the atmosphere in the high temperature furnace is neutral or weak-reductive. The invention has the advantages of short reduction time, simple process, high dephosphorization rate, high iron yield, less environmental pollution, recyclable residue and the like.