Acid-base reactions of iron

If iron is in an acidic solution, it will pick up electrons, making it more negative, visibly disappearing as it dissolves into liquid. If that same iron is near free oxygen molecules, it will pass its extra electrons to the oxygen, making it more positive, and will bond with the oxygen atoms, precipitating out of solution as solid iron. The reddish pigment is oxidized iron, or rust.

Stated more simply: In acid conditions, the iron dissolves, in oxygen-rich situations, iron precipitates.