Abstract: A theoretical study of the carbon atoms adsorption and diffusion on the surface and into the subsurface of Fe (111) is performed using DFT calculations. Before the carbon coverages up to 1 ML, the adsorbed carbons tend to exist in an isolated atomic state and cause a reconstruction of Fe (111) surface. The configurations of "mC₂+nC" are energetically favorable on the Fe (111) surface at 1 ML ≤ θ_C ≤ 2 ML. At a higher coverage, complicated adsorbed patterns such as chains and islands are found, and we predict that these carbon islands can function as the nucleation center of the precipitation of graphite or carbon nanotubes on the Fe(111) surface. In the subsurface region, the carbon atom prefers the octahedral site. The barriers for diffusion on and into the Fe (111) surface and subsurface are 0.45 eV and 0.73 eV, respectively. Actually, C₂ formation is thermodynamically favored, whereas C migration into the subsurface region is kinetically feasible.