Low-temperature hydrothermal vents, such as those encountered at Loihi Seamount, harbor abundant microbial communities and provide ideal systems to test hypotheses on biotic versus abiotic formation of hydrous ferric oxide (FeOx) deposits at the seafloor. Hydrothermal activity at Loihi Seamount produces abundant microbial mats associated with rust-colored FeOx deposits and variably encrusted with Mn-oxyhydroxides. Here, we applied Fe isotope systematics together with major and trace element geochemistry to study the formation mechanisms and preservation of such mineralized microbial mats. Iron isotope composition of warm (< 60 °C), Fe-rich and H2S-depleted hydrothermal fluids yielded δ56Fe values near +0.1 ‰, indistinguishable from basalt values. Suspended particles in the vent fluids and FeOx deposits recovered nearby active vents yielded systematically positive δ56Fe values. The enrichment in heavy Fe isotopes between +1.05 ‰ and +1.43 ‰ relative to Fe(II) in vent fluids suggest partial oxidation of Fe(II) during mixing of the hydrothermal fluid with seawater. By comparing the results with experimentally determined Fe isotope fractionation factors, we determined that less than 20% of Fe(II) is oxidized within active microbial mats, although this number may reach 80% in aged or less active deposits. These results are consistent with Fe(II) oxidation mediated by microbial processes considering the expected slow kinetics of abiotic Fe oxidation in low oxygen bottom water at Loihi Seamount. In contrast, FeOx deposits recovered at extinct sites have distinctly negative Fe-isotope values down to -1.77 ‰ together with significant enrichment in Mn and occurrence of negative Ce anomalies. These results are best explained by the near-complete oxidation of an isotopically light Fe(II) source produced during the waning stage of hydrothermal activity under more oxidizing conditions. Light Fe isotope values of FeOx are therefore generated by subsurface precipitation of isotopically heavy Fe-oxides rather than by the activity of dissimilatory Fe reduction in the subsurface. Overall, Fe-isotope compositions of microbial mats at Loihi Seamount display a remarkable range between -1.2 ‰ and +1.6 ‰ which indicate that Fe isotope compositions of hydrothermal Fe-oxide precipitates are particularly sensitive to local environmental conditions where they form, and are less sensitive to abiotic versus biotic origins. It follows that FeOx deposits at Loihi Seamount provides important modern analogues for ancient seafloor Fe-rich deposits allowing for testing hypotheses about the biogeochemical cycling of Fe isotopes on early Earth.