Ferroptosis is a distinct form of cell death driven by the accumulation of peroxidized lipids. Characterized by alterations in redox lipid metabolism, ferroptosis has been implicated in a variety of cellular processes, including cancer. Induction of ferroptosis is considered a novel way to kill tumor cells, especially cells resistant to radiation and chemotherapy. However, in recent years, a new paradigm has emerged. In addition to promoting tumor cell death, ferroptosis causes potent immune suppression in the tumor microenvironment (TME) by affecting both innate and adaptive immune responses. In this review, we discuss the dual role of ferroptosis in the antitumor and protumorigenic functions of immune cells in cancer. We suggest strategies for targeting ferroptosis, taking into account its ambiguous role in cancer.