<p>In this paper, the property degradation micromechanism of Al-5.10Cu-0.65&#xa0;Mg-0.8Mn (wt%) alloy induced by 0.5&#xa0;wt% Fe minor addition was revealed by atomic-scale scanning transmission electron microscopy and energy-dispersive X-ray spectroscopy coupled with first-principles calculations. The results show that the Fe minor addition to the Al-Cu-Mg-Mn alloy leads to a slight reduction of grain size and the formation of coarse Al₇Cu₂Fe constituent particles. Fe tends to segregate into the T-phase dispersoids, θ'-, and S-phase precipitates by preferentially occupying Cu or Mn sites in these phase structures. The apparent Fe segregation contributes to an increase in stiffness of the T-phase and S-phase but decreased stiffness of the θ' phase. Formation of the coarse Al₇Cu₂Fe constituent particles and decreased stiffness of main precipitates θ' containing Fe result in the degraded strength of the Al-Cu-Mg-Mn-Fe alloy. Further study reveals that corrosion resistance degradation of the Al-Cu-Mg-Mn-Fe alloy is associated with the increased width of precipitation free zones and consecutive grain boundary precipitates. The obtained results have significant implications for the usage of recycled Al alloys and the potential design strategies of high-performance alloys containing Fe.</p> Graphic abstract <p></p>