Sangan Iron ore deposit is located 300 km southeast of Mashhad (Eastern Iran). Based on the high grade, low P- content and big ore reserve, Sangan is an important Iron mine in Iran. It is a magnetite skarn and can be classified as iron-oxide type deposit. Based on the surface exposure, the western magnetite skarn (A´), a Ca-rich type skarn, was formed at the contact of intrusive. Eastward, the skarn gradually becomes distal and Mg-type. The A´ magnetite skarn contains andradite, magnetite, K-rich amphibole, hedenbergite and calcite. Magnetite skarn in A, B, and C- south contain magnetite, repidolite, ferro-actinolite, siderite and minor pyrite. Baghak and C- north magnetite skarn comprise Mg-rich- magnetite, phlogopite, chinochlore, talc, dolomite, forsterite, dolomite, pyrite ± chalcopyrite ± arsenopyrite ±  pyrrhotite. High S-content is found mainly in Baghak and C-north deposits. In this research, the igneous source rock is found in A´ deposit and identified as ultra-potassic type (K₂O> %9). Sarnowsar granite which used to be the source rock for Iron, contains less than %5 K₂O, therefore it cannot be the source. The K₂O content of Sarnowsar granite increases near the magnetite skarn due to alteration. The Fe-ore bearing solution moved along the contact between Sarnowsar granite and the limestone. Sarnowsar granite was altered and skarn formed in the limestone.
The source rock is quartz biotite-hornblende alkali syenite to quartz hornblende syenite porphyry. The younger intrusive rocks are biotite granite, biotite-hornblende quartz monzonite porphyry and quartz syenite porphyry. Potassium within the ore bearing solution controlled the mineralogy of skarn. Contact skarn in A´ magnetite deposit comprises K-rich amphibole and distal skarn (Baghak and C-north) contains phlogopite.
Comparison of trace elements from source rocks with Sarnowsar granite indicates that the Nb, Zr, Zn and Rb contents are high in the former rocks and Cu and Sr ones are higher in the latter rock. Furthermore, comparison of some trace elements from source rocks with younger intrusive rocks indicate that Cr, Ni, Zr, Ce, Cu, Sr, and La contents are higher in younger intrusive and Rb content is higher in source rocks.