There is a growing global demand on bio-hydrogen production (BHP) using costless and wastes material. Herein we demonstrate the possibility to produce high yield of hydrogen using a new bacterial strain grown on acidic hydrolyzed cyanobacterial biomass as a costless carbon feedstock under various iron concentrations. We used E. coli DH701 mutant and new strain Brevibacillus invocatus SAR isolated from Assiut city soil samples. The mentioned new strain was identified morphologically, biochemically and by molecular analysis using 16S rDNA sequence. Limitation of iron induced BHP in tested cyanobacteria. Iron concentration (0.045 mM) enhanced hydrogenase activity and cumulative hydrogen evolution in the investigated cultures. B. invocatus yielded 3.3 mol H2/mole glucose and 3.8 mol H2/mole reducing sugar (algal biomass), while the mutant strain yielded 1.78 mol H2/mole glucose and 3.4 mol H2/mole reducing sugar (algal biomass). Thus, the use of algal biomass induced higher potency of BHP especially at 0.045 mM iron.