Pyrite has complicated iron isotope fractionation behavior in the hydrothermal condition. Here we present a detailed in-situ iron isotope analyses of different generation pyrite from the Muping gold deposit, eastern China. δ⁵⁶Fe values of pyrite investigated range from −4.25‰ to +1.78‰, unlike previous bulk analytic data (−0.78‰ to +0.79‰). Iron isotopic homogeneity of single pyrite grain, which can be verified by in-situ analysis, was recommended as the preferred and reliable criterion to judge the isotopic fractionation condition in the hydrothermal gold deposit. Inter-grain variations in Fe isotopic composition suggest occurrence of both kinetic and equilibrium fractionation for pyrite at Muping. Electron backscattered diffraction analysis shows that the replacement likely occurred via dissolution-reprecipitation pathway. The replacement process resulted in obvious kinetic isotope effect, in which pyrites are possessed in extreme negative Fe isotopic composition (~−4‰). Maximum δ⁵⁶Fe of pyrite up to +1.78‰ implied that kinetic isotopic effect also play a significant role in increasing the Fe isotopic composition of ore-forming fluids in the Muping gold deposit. Further model calculations suggested the kinetic isotopic effect was dominated by pyrite fast precipitation rather than pyrrhotite precipitation or pyrite precipitation via “FeS” pathway. This kinetic isotope effect ultimately will be partly or completely erased due to fast isotope exchange rate at medium–high temperature condition. Pyrite with homogeneous Fe isotopic composition can be used to trace iron source of hydrothermal gold deposit but be cautious.