A process with coal-based direct reduction followed by magnetic separation is presented for recovering metallic iron from a limonite in Jiangxi province, the effects of reduction temperature and reduction time on the concentrate product were investigated. The results show that, the reduction time has an important influence on the formation and growth of the metallic iron particles. When the reduction time is too short, the iron particle formed is fine; when the reduction time is too long, a large amount of fayalite produced by the solid reaction of FeO and SiO2, which may resulted in a decrease of the iron content of the concentrate. The increase of reduction temperature has a positive impact on the gas diffusion and chemical reaction. The higher the temperature, the faster the chemical reaction which is facilitated to the agglomeration of the metallic iron; but the temperature should not be too high, too high temperature resulted in the gas diffusion velocity increased, it is difficult to provide reducing atmosphere for the reduction reaction.