Oriented thin films of β-(Ga1-xFex)2O3 have been deposited by RF magnetron sputtering on c-Al2O3 and GaN substrates. The itinerant character of Fe 3d states forming the top of the valence band (VB) of Fe substituted of β-Ga2O3 thin films has been determined from resonant photoelectron spectroscopy (RPES). Further, admixture of itinerant and localized character of these Fe 3d sates is obtained for larger binding energies i.e deeper of VB. The bottom of the conduction band (CB) for β-(Ga1-xFex)2O3 is also found to be strongly hybridized states involving Fe 3d and O 2p states as compared to that of Ga 4s in pristine β-Ga2O3. This suggests that β-Ga2O3 transforms from band like system to a charge transfer system with Fe substitution. Furthermore, the bandgap red shits with Fe composition, which has been found to be primarily related to the shift of the CB edge.