Clay-driven transformation of polycyclic aromatic hydrocarbons (PAHs) is critically influenced by their molecular structure and clay surface properties. In the present study, several PAHs were selected as model molecules to investigate their potential transformation on Fe(III)-saturated clay minerals under various mineralogical and environmental conditions. Results suggest that the reactivity of PAHs is highly correlated with their ionization potential (IP) values. PAHs with IP lower than a threshold between 7.5 and 7.6 prefer undergoing a one-electron transfer reaction. Otherwise, Fe(III)-smectite is unable to degrade PAHs with IP above it. The electron-transfer process leads to the reduction of Fe(III) to Fe(II) and formation of organic radical cations, which are more stable in clay interlayers than at other clay sites. Subsequent reactions of radical cations with oxygenic species (such as H2O) result in formation of oxygenated products. The surface chemical properties, i.e., the hydration of cations, fraction of Fe(III), layer charge location, and type of ligands, strongly affect the interaction between PAHs and Fe(III), thus modulate the reactivity of surface Fe(III)-species on the clay minerals. This study provides the first direct evidence for clay-catalyzed transformation of PAHs supporting the plausibility of their in situ degradation in soils, and demonstrates that abiotic reactions with surface-bound Fe(III) may affect or even dominate the long-term behavior of PAHs in soils, particularly in the presence of swelling clay minerals.