The invention discloses iron oxide for a lithium iron phosphate battery material, and its preparation method. The preparation method mainly comprises the following steps: 1, removing impurities from a steel plate pickling waste liquid to reduce the contents of impurities comprising SiO2, P2O5, Al2O3 and the like in iron oxide; 2, carrying out low temperature roasting of the impurities removed pickling waste liquid to improve physical performances of the iron oxide; 3, grinding with a pearl mill until the average particle size of the iron oxide reaches below 0.5mum; and 4, washing the iron oxide slurry obtained after the grinding with desalinized water, and carrying out treatments comprising press filtration, drying, crushing and the like. According to the invention, the contents of the impurities comprising SiO2, P2O5, Al2O3, Cl<->, Ca<2+>, K<+>, Na<+>, SO4<2-> and the like in the iron oxide are greatly reduced; and the physical performances comprising the specific surface area (BET), the loose specific weight, the average particle size particle size reduction and the like of the iron oxide are improved,