A novel and durable organic-inorganic flame retardant (FR) system for wool fabric was fabricated using natural phytic acid (PA), titanium dioxide (TiO2) nanoparticles and 1,2,3,4-butanetetracarboxylic acid (BTCA). In order to address the diffusion barrier action of wool fiber to the FR agents, an additional exhaustion process was employed ahead of the traditional pad-dry-cure procedure. The flame retardancy, smoke generation, thermal stability, and washing durability of the treated fabrics were discussed. The PA/TiO2/BTCA system endowed wool fabric with excellent flame retardancy and washing durability. The treated fabric was still able to self-extinguish after 30 washing cycles. Moreover, the FR system effectively reduced the smoke generation capacity. Thermogravimetry test shows that the FR system altered the thermal decomposition behavior of wool, and the formation of thermal protective intumescent char mainly contributed to the improved flame retardancy, revealing a significant condensed-phase FR mechanism of the treated wool.