Tetracarbonylhydridoferrate, $HFe(CO)^-_4$, generated by the reaction of $Fe(CO)_5$ with alkaline solution, is a good reducing agent for mono-dehalogenation of gem-dihalocyclopropanes. It also acts as a good reducing catalyst under phase transfer reaction conditions. 1,1-Dibromo-2-phenylcyclopropane and 1,1-dichloro-2-phenylcyclopropane were reduced to the corresponding mono-dehalogenated products in excellent yields. Thermodynamically stable trans-l-bromo-2-phenyl cyclopropane was formed as the major product over the cis-isomer, trans/cis=3/2. The 1-bromo-2-phenyl cyclopropane radical intermediate was formed by single electron transfer from $HFe(CO)^-_4$. Dissociation of bromide anion, followed abstraction of hydrogen radical from alcoholic solvent would lead to the formation of the stable trans-isomer. The further mechanistic aspects were discussed.