We report a nanoparticulate iron oxide based catalyst for CO2 conversion with high efficiency at low pressures and on the effect of the presence of copper on the catalyst's restructuring and its catalytic performance. In situ X-ray scattering reveals the restructuring of the catalyst at the nanometer scale. In situ X-ray absorption near edge structure (XANES) shows the evolution of the composition and oxidation state of the iron and copper components under reaction conditions along with the promotional effect of copper on the chemical transformation of the iron component. X-ray diffraction (XRD), XANES and Raman spectroscopy proved that the starting nano catalyst is composed of iron oxides differing in chemical nature (alpha-Fe2O3, Fe3O4, FeO(OH)) and dimensionality, while the catalyst after CO2 conversion was identified as a mixture of alpha-Fe, Fe3C, and traces of Fe5C2. The significant increase of the rate CO2 is turned over in the presence of copper nanoparticles indicates that Cu nanoparticles activate hydrogen, which after spilling over to the neighbouring iron sites, facilitate a more efficient conversion of carbon dioxide.