Dietary modification, supplementation and food fortification are common strategies to alleviate iron deficiencies. Fortification of food is an effective long-term approach to improve iron status of populations. Fortification by adding iron directly to food will cause sensory problems and decrease its bioavailability. The purpose of iron encapsulation is: (1) to improve iron bioavailability, by preventing oxidation and contact with inhibitors and competitors; and (2) to disguise the rancid aroma and flavor of iron. A microcapsule formulation of two suitable iron compounds (iron II fumarate and iron II gluconate) using chitosan as a biodegradable polymer will be very important. Freeze dryer was also used for completing the iron microencapsulation process. The main objective of the present study was to prepare and characterize the iron-chitosan microcapsules. Physical characterization, i.e. encapsulation efficiency, iron loading capacity, and SEM, were also discussed in this paper. The stability of microencapsulated iron under simulated gastrointestinal conditions was also investigated, as well. Both iron sources were highly encapsulated, ranging from 71.5% to 98.5%. Furthermore, the highest ferrous fumarate and ferrous gluconate loaded were 1.9% and 4.8%, respectively. About 1.04% to 9.17% and 45.17% to 75.19% of Fe II and total Fe, were released in simulated gastric fluid for two hours and in simulated intestinal fluid for six hours, respectively.