The initial viscosities of propellants based on yellow iron oxide and red iron oxide were similar. Furthermore, it was confirmed that the thermal decomposition rate of the material to which yellow iron oxide was added was higher than that of the material to which red iron oxide was added; in particular, the pressure index at high pressure was low. From analyzing the combustion properties of the actual test motor, it was concluded that erosion and combustion mainly occur in the initial stage of operation of the rocket motor, and are mitigated due to the low initial pressure in the propellant containing yellow iron oxide. The mechanical properties of the propellant with yellow iron oxide were slightly better compared to those of the propellants with red iron oxide. The analysis revealed that the crystallinity, volatility, thermal decomposition, and mechanical properties of yellow iron oxide were unchanged with natural aging for 10 years. Thus, yellow iron oxide can exhibit the same performance even after prolonged aging for 10 years when applied in a rocket motor.