Iron homeostasis is regulated by the hepcidin-ferroportin axis. Hepcidin, a hepatic peptide hormone, is the master regulator: it binds to ferroportin (the sole iron exporter on enterocytes and macrophages), causing its internalization and degradation, thereby reducing iron absorption and release from stores. In iron deficiency, hepcidin is suppressed, maximizing iron absorption. In anemia of chronic disease (ACD), inflammatory cytokines (IL-6) upregulate hepcidin, trapping iron in macrophages despite adequate stores—creating functional iron deficiency. The clinician must differentiate IDA from ACD, thalassemia trait, and sideroblastic anemia using advanced iron studies, prescribe appropriate iron formulations (oral vs. parenteral), investigate underlying etiology, and manage refractory cases.