A novel Ag/Fe₂O₃/ZnO ternary composite was fabricated using the chemical deposition and photochemical deposition methods. Its structure and optical properties were characterized using X-ray diffraction (XRD), scanning electron microscopy (SEM), transmission electron microscopy (TEM) and ultraviolet-visible spectrophotometry. The Ag/Fe₂O₃/ZnO ternary composite exhibited a greater improvement in photocatalytic activity compared with the Fe₂O₃/ZnO or Ag/ZnO binary composite. The degradation rate of Ag/Fe₂O₃/ZnO towards methyl orange (MO) and iodoform (CHI₃) within 120 min was 80% and 94%, respectively. More importantly, the Ag/Fe₂O₃/ZnO composite had a much higher degradation efficiency towards iodoform, which indicates its efficient and selective degradation characteristics. The results show that the Ag/Fe₂O₃/ZnO ternary composite holds great potential in the removal of carcinogenic iodoform from sewage.