The structural and electronic properties of iron clusters ${\mathrm{Fe}}_{\mathit{n}}$ (n\ensuremath{\le}5) are studied using a Gaussian orbital local (nonlocal) spin-density method. Starting from n=2 and 3 with localized multiple d bonds and short equilibrium bond lengths, ${\mathit{R}}_{\mathit{e}}$\ensuremath{\simeq}2 \AA{}, the bonding evolves towards a metallic s pattern with longer ${\mathit{R}}_{\mathit{e}}$'s and higher atomic magnetic moments. Ferromagnetic ground states are highly favored with the gain in magnetic energy promoting the close-packed structure (for n=3--4) or distortions into more open structures (for n=5).