In this study, we report template and surfactant-free, low temperature (70°C) synthesis of needle-like α-FeOOH and its conversion at 400°C into α-Fe2O3 nanorods using Fe(+2) and Fe(+3) chlorides and urea as a hydrolysis-controlling agent. The isolated needle-like α-FeOOH indicates asparagus-type growth pattern having length ca. 600 nm with 80 nm diameter at base and apex diameter of around 10 nm. The sample on heating (α-Fe2O3) shows nanorod-like morphology. The samples were characterized using various physicochemical characterization techniques such as XRD, Raman spectroscopy, UV-Vis spectroscopy, particle size distribution analysis, Field Emission Scanning Electron Microscopy (FE-SEM), and humidity sensing performance. The humidity sensing behavior of both α-FeOOH and α-Fe2O3 was studied. The α-FeOOH shows quicker (10 s) and higher response toward change in humidity from 20%RH to 90%RH as compared with α-Fe2O3 (60 s). Their typical morphology and crystalline structure plays an important role in humidity sensing behavior.