The incubation of a ghost-free erythrocyte lysate with the oxidizing agent phenylhydrazine resulted in both methemoglobin formation and release of iron in a desferrioxamine (DFO)-chelatable form. The released iron was diffusible, as shown by a dialysis carried out simultaneously with the incubation. When the dialysate was added to erythrocyte ghosts or to microsomes from liver or brain, lipid peroxidation developed in the membranes, indicating that the diffusible iron was in a redox active form. The addition of ATP to the lysate markedly increased both iron diffusion and lipid peroxidation in the membranes subsequently added to the dialysate. The possible implication of these data in some well known pathologies is discussed.