The work aims to study effect of gas constant on reduction of Fe2O3 by atmospheric pressure plasma jet. The sample was prepared by cold forming and high temperature sintering from Fe2O3 test-pieces. Iron-based oxide was reduced by atmospheric pressure cold plasma jet. Phases of the samples treated by plasma were analyzed by virtue of X-ray diffraction (XRD), and morphology of the samples was observed by virtue of a scanning electron microscopy (SEM). The function and influence of atmosphere on reduction process were analyzed. Composition and content of reducing gas played a major role in reducing capacity of the plasma. The Fe2O3 couldn’t be reduced by nitrogen plasma provided with normal pressure and temperature, while the Fe2O3 could be reduced to the Fe3O4 and Fe by mixed gas consisting of plasma and ammonia. The reducing capacity increased while the reduction rate decreased as the ammonia content increased. Various reducing substances could be produced by ammonia in the plasma, such as N2H4 , H and H2*, which could reduce Fe2O3, and it was a transitional reduction process: Fe2O3 was first reduced to Fe3O4, and then reduced to Fe. The Fe2O3 could not be reduced by electrical and thermal effects in atmospheric pressure cold plasma. The Fe-based oxide could be reduced by a series of active materials produced in the plasma containing ammonia gas.