The deposition of MgO on the Fe(001) surface has been carried out using electron beam evaporation. MgO is observed to grow epitaxially with a 45° rotation between the Fe(001) and MgO(001) unit cell axes. Oscillations in the intensity of the RHEED specular beam are observed at room temperature showing that growth is two-dimensional. The relaxation of the in-plane lattice parameter during the growth at room temperature has been investigated in-situ by measuring the position of the RHEED streaks and ex-situ with GIXD experiments. Pseudomorphic growth is observed up to about five monolayers. Then the in-plane lattice parameter starts to evolve towards the MgO bulk parameter. HREM shows that the relaxation of MgO occurs via the generation of 1/2<011> misfit dislocations which are non-uniformly spaced at the Fe/MgO interface.