Iron sponge is widely used in gas purification processes, particularly for removing hydrogen sulfide (H₂S) from natural gas, biogas, and synthesis gas. It functions through a chemical reaction where H₂S reacts with iron oxide in the sponge to form iron sulfide and water, effectively trapping the sulfur compound. This makes it valuable in industries where low sulfur content is critical, such as in fuel gas processing and ammonia production.

It is commonly applied in low-temperature, low-pressure gas streams due to its high selectivity and efficiency under such conditions. Iron sponge is also favored in remote or offshore operations because of its simplicity, low operational complexity, and minimal need for auxiliary equipment. Once spent, the material can sometimes be regenerated or safely disposed of, depending on environmental regulations. Its use helps meet environmental and safety standards by preventing corrosion in pipelines and reducing sulfur emissions.