Small natural variations in Fe isotopes have been attributed to biological cycling. However, without understanding the mechanisms of fractionation, it is impossible to interpret such variations. Here we show that the δ56Fe of Fe dissolved from a silicate soil mineral by siderophore-producing bacteria is as much as 0.8‰ lighter than bulk Fe in the mineral. A smaller isotopic shift is observed for Fe released abiotically by two chelates, and the magnitude of the shift increases with affinity of the ligand for Fe, consistent with a kinetic isotope effect during hydrolysis of Fe at the mineral surface. Fe dissolved abiotically without chelates shows no isotopic shift. The δ56Fe of the exchange fraction on soil grains is also lighter by ∼0.6‰–1‰ than Fe from both hornblende and iron oxyhydroxides. The kinetic isotope effect is therefore preserved in open systems such as soils. When recorded in the rock record, Fe isotopic fractionation could document Fe transport by organic molecules or by microbes where such entities were present in the geologic past.