A series of low-temperature Fischer–Tropsch synthesis (FTS) experiments using a wide range of H2/CO/CO2 syngas mixtures have been performed to provide further insight into the effect of the CO2 on an iron-based catalyst during FTS. In comparison with CO hydrogenation, the reactivity for CO2 hydrogenation was lower and produced more CH4-rich short chain paraffins. Based on the correlation between the experimental results and the thermodynamic equilibrium calculations for the water gas shift (WGS) reaction, although the WGS reaction is far from the thermodynamic equilibrium under low-temperature FTS conditions, its equilibrium constraints determine the pathways and in particular whether CO is converted to CO2 or CO2 to CO. It is possible for CO2 to convert to hydrocarbons only when the composition of co-fed CO2 has a value higher than that set by the equilibrium constraints. A remarkable feature of our experimental results was that when the FTS system was not consuming but forming CO2, the reaction rates of both the FT and the WGS reactions were independent of the partial pressures of CO and CO2. Furthermore, with a decrease in the ratio of CO2/(CO+CO2) in the feed gas, it was observed that the hydrocarbon product formation rate reached a maximum and then maintained this value, even at a very high concentration of CO2 in the H2/CO/CO2 feed mixture. These results could justify the inclusion of CO2 in the syngas feed to the iron-based catalyst FTS processes.