Abstract The path of the reaction between Fe₂O₃ and Si, activated by high energy ball milling, has been investigated by X-ray diffraction and Mössbauer spectroscopy. Hematite reduction involves oxygen transfer from Fe to Si with the formation of intermediate phases containing Fe(II), which are then reduced to Fe(0). A steady state is reached in the milling process where the reduction of stoichiometric amounts of Fe₂O₃ and Si is not complete and an amount of Fe(II) in an amorphous matrix still remains. The same intermediate compounds are also observed in the milling process of mixtures with higher Fe₂O₃ /Si molar ratio.