Cost-effective ultrasonically assisted precipitation method is utilized to synthesize Zinc oxide (ZnO) nanoparticles (NPs) at room temperature and the effect of Iron (Fe) doping on structural, optical and spin relaxation properties also presented. As-synthesized pure and Fe doped ZnO NPs possess a perfect hexagonal growth habit of wurtzite zinc oxide, along the (101) direction of preference. With Fe doping, 'c/a' ratio and compressive lattice strain in ZnO NPs are found to reduce and increase, respectively. Raman studies demonstrate that the E-1 longitudinal optical (LO) vibrational mode is very weak in pure which remarkably enhanced with Fe doping into ZnO NPs. The direct band gap energy (E-g) of the ZnO NPs has been increased from 3.02 eV to 3.11 eV with Fe doping. A slight red-shift observed with strong green emission band, in photoluminescence spectra, is strongly quenched in 6 wt.% Fe doped ZnO NPs. The field emission scanning electron microscopy (FESEM) and transmission electron microscopy (TEM) reveals spherical shape of ZnO NPs with 60-70 nm, which reduces substantially on Fe doping. The energy dispersive X-ray spectrum and elemental mapping confirms the homogeneous distribution of Fe in ZnO NPs. Moreover, the specific relaxation rate (R-2sp = 1/T-2) has been measured using Carr-Purcell-Meiboom-Gill (CPMG) method and found to be maximum in 6 wt.% Fe doped ZnO NPs. Further, the correlation of structural, optical and dynamic properties is proposed. (C) 2017 Elsevier B.V. All rights reserved.