The interaction between an iron atom and graphene containing a single Stone–Wales (SW) defect has been investigated by ab initio density functional calculations. The top site on the core defective bond-rotated carbon atom turns out to be the most favorable for iron atom adsorption. The local magnetic moment of the iron atom is 2.24  μ_B in this adsorbed system, and it can be interpreted by an effective Fe 3d⁸4s⁰ configuration caused by the strong interaction between the adatom and the core defective bond-rotated carbon atom. The defect minimizes the binding energy with respect to the adsorption of iron atoms on defect-free graphene and consequently makes the adsorbed systems more stable. Additionally, the adsorption of iron atoms on the defective graphene induces the adsorbed structures to be distorted evidently along the direction perpendicular to the graphene sheet. In particular, the band structures of these adsorbed systems, with some spin-polarized gap states lying between the π and π^* bands, are modulated by Fe 3d states in the vicinity of the Fermi level, and the gap between the valence band maximum and conduction band minimum is decreased to almost zero due to the interaction of Fe 3d states with C 2p states.