Fe- and N-modified carbon nanofibers (Fe-CNF) were synthesized via electrospinning and pyrolysis as electrocatalysts for oxygen reduction reaction (ORR). In order to increase the exposed surface area with the active sites buried inside Fe CNF, we attempted water vapor activation for Fe CNF and observed a substantial improvement of ORR activity up to the comparable level with Pt/C. Unlike what was expected, however, water vapor activation did not significantly increase the specific surface area of Fe CNF; instead, it induced a depletion of surface N content, which makes it difficult to explain the improved ORR activity with the increase of surface area with N-based active sites. In water vapor activation, the chemical phase of embedded particles is changed from Fe3C to Fe3O4 and nitrogen-free Fe and C-based ORR active sites were exposed, which seemed to be related with hierarchical macro/mesopore structure and graphitic edge defects. This study demonstrates a facile activation method for better ORR activity of Fe-modified CNF and suggests a potential relationship of surface carbon structure with the catalytic activity toward ORR rather than the type and concentration of N in Fe CNF, which should be investigated further.