Abstract Iron accumulation and ferroptosis occur in the brain following ischemic stroke. However, the relationship between iron overload and cell type‐specific fates remains largely unclear. Here, iron deposition and neuronal loss are reported within the perilesional cortex of three patients with ischemic stroke at both acute and subacute stages. It is identified that ischemia/reperfusion‐induced iron overload triggers ferroptosis predominantly in neurons and to a lesser extent in astrocytes, whereas most astrocytes undergo reactive proliferation. Mechanistically, the reduced or elevated Nrf2/GPX4 and SLC7A11 levels in neurons or astrocytes, respectively, account for these distinct iron overload‐induced cellular fates. Moreover, iron overload promotes astrogliosis by enhancing the transcriptional activities of several proliferation‐related genes. Using mice with partial knockout of the transferrin receptor 1 (TfR1) gene Tfrc , astrocyte‐specific Tfrc knockdown, and conditional astrocytic Cpt1a partial knockout (to induce fatty acid metabolism disorders), it is revealed that increased TfR1 palmitoylation and clathrin‐mediated endocytosis drive astrocytic iron overload. Notably, ischemia/reperfusion‐induced elevation of palmitic acid is associated with enhanced TfR1 palmitoylation. Treatment with antioxidants or iron chelators mitigates ischemic brain injury. Together, these findings provide a comprehensive framework linking ischemia/reperfusion‐induced iron overload to cell type‐specific fates. TfR1 palmitoylation emerges as a potential target for ischemic stroke therapy.