The structures, interaction, and magnetic properties of Fe atoms with a single-wall carbon nanotube are investigated using Car-Parrinello molecular dynamics. The stability, band gap, Fermi energy, and total magnetic moment of the Fe-adsorbed single-wall carbon nanotube systems are found to depend on the location of the Fe atoms relative to the carbon nanotube surface. The confinement and the curvature of nanotubes have a strong effect on the relative stability of various structures corresponding to different positions of the Fe atom inside and outside carbon nanotubes. The Fe atoms inside a carbon nanotube are found to couple ferromagnetically.

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