Significance Some studies suggested that the Earth’s mantle transition zone (MTZ) consists of hydrous silicates while others proposed that it contains iron metal. Here we show that the metallic iron dehydrates hydrous silicates at MTZ conditions, implying that global hydration of silicates and metal saturation are incompatible. Comparing iron production in and water injection to the MTZ, we found that the hydration of MTZ silicates is likely limited to <0.1 wt %, while large amount of the hydrogen can be stored as iron hydride and hydrogen fluid instead. Water-rich domains may still exist near the modern active subducted slabs. Our finding connects the water content to the oxidation state of the MTZ, thus providing a different perspective on volatile cycles in the mantle.