The present work describes the preparation of gold nanoparticles (AuNPs) functionalized with hydroxamic acid and the use of them in UV-visible spectroscopy detection of iron(III) ions. The prepared AuNPs were thoroughly characterized by using UV-visible spectroscopy, TEM, and 1H NMR techniques. The newly synthesized hydroxamic acid-AuNPs are brown in color due to the intense surface plasmon absorption band centered at 527 nm. In the presence of Fe(III), the surface plasmon absorption band is centered at 540 nm. However, the sensitivity of hydroxamic acid-AuNPs towards other metal ions such as Mg(II), Ca(II), Ag(I), Cu(II), Mn(II), Cr(II), Ni(II), Co(II),Fe(II), Hg(II), and Pb(II) can be negligible. This highly selective sensor allows a direct quantitative assay of Fe(III) with a UVvisible spectroscopy detection limited to 45.8 nM.