Control of toxic or carcinogenic disinfection byproduct (DBP) formation in drinking water is critical in an effort to improve drinking water safety and safeguard public health, due to the elevation of dissolved organic matter in source water. In this study, the oxidation by ferrous iron (Fe2+) and hydrogen peroxide (H2O2) reactions was investigated to assess its efficacy for reducing the DBP forming potentials of four trihalomethanes (THMs) and five haloacetic acids (HAAs) that are currently regulated by the United States Environmental Protection Agency. Results indicated that the oxidation efficacy was dependent on pH, concentrations of Fe2+ or H2O2 added, and initial dissolved organic carbon (DOC) (Resorcinol used as a model compound) level in simulated source waters. Under pH 5.0 and initial 2 mg C/L conditions, the treatment using 0.25 mM of Fe2+ and H2O2 was able to achieve the reductions of 94% THMs and 77% HAAs forming potentials after 90 min reaction. Furthermore, the treatment would also lead to 30% and 36% decreases in DOC and chemical oxygen demand, respectively. More importantly, the oxidation reactions showed the similar reduction efficiency for the DBP forming potentials in the presence of Escherichia coli and resulted in the effective E. coli disinfection in drinking water. pH was identified as one of the most important parameters affecting the efficacy for DBP control. This research demonstrated that the oxidative treatment by the Fe2+-H2O2 reactions would effectively mitigate DBP formation through oxidative removal of DOC and achieve drinking water disinfection simultaneously as well, which could be potentially applied, as a cost-effective and environmental-safe drinking water treatment technology, to small water systems in rural communities with elevated Fe2+ and slightly acidic source water.