The iron-apatite deposits of the Bafq mining district contain elevated REE content and occur together with vast alterations in country-rock which were formed due to widespread hydrothermal processes in Early Cambrian. Apatite and rare earth element geochemistry as well as radioactive isotope studies of Sm-Nd show that apatite formation might be due to hydrothermal activities and remobilization of coeval or older sedimentary phosphorites which are consequently deposited as apatite veins or veinlets associated with iron-oxide mineralization. This huge hydrothermal circulation was induced by intrusion of Early Cambrian igneous rocks such as granites and locally diorites, and is responsible to iron-apatite mineralization, locally associated with REE minerals, and extensive host rock alterations (sodic-potassic) due to vast fluid-rock interaction.