In the first film, Iago has a supporting role as Jafar's sidekick, and also served as his spy, disguising himself as Jafar's mindless pet parrot.
Iago is first seen during his and Jafar's confidential visit to the desert, in the middle of the night, where they are met by a thief,Gazeem. After forcefully handing over a stolen piece of a golden scarab, courtesy of Iago, Jafar is able to create one full, magical scarab, which reveals the location of the Cave of Wonders. Gazeem is ordered to enter in order to steal a magic lamp (as Jafar wishes to use the Genie to take control of Agrabah), but is killed in the process, as a result of being unworthy to enter. A frustrated Iago voices his annoyance, believing their mission to retrieve the lamp will forever be an impossible task to complete. Jafar, however, remains level-headed, and assures Iago that the lamp will be in their possession once they find the "diamond in the rough".
After returning to Agrabah, Jafar and Iago visit The Sultan, needing his diamond ring to uncover the individual worthy to enter the cave. Here, Iago shows his disdain for the Sultan; specifically due to the ruler constantly shoving "moldy, disgusting crackers" down his throat. Jafar reassures Iago that they will no longer have to abide to the Sultan's reign in good time, with Iago gleefully plotting to extract revenge once that time has arrived.
After discovering a boy named Aladdin is the one worthy enough to enter the cave, he travels to the Cave of Wonders with Jafar, though the mission goes awry, resulting in both the lamp, and Aladdin, being lost. Afterwards, at the palace, Iago concocts a new plan involving a rise to power. He advises Jafar to marry Jasmine, which would result in the vizier legally becoming the sultan. Once he holds such power, Iago continues, they'll kill Jasmine and her father. Jafar agrees, but their plot is interrupted by a new coming prince—Ali. Jafar and Iago soon discover that Ali is Aladdin, and holds ownership over the lamp. Iago is sent to retrieve it, doing so by cunningly disguising his voice as Jasmine to lure Aladdin away from the lamp.
With the lamp in his possession, Jafar takes over the kingdom, bestowing Iago with his own turban, to signify his leadership, as well as his own lounge area near the throne, with a throw pillow and plenty of fruit for his pleasure. After scarfing crackers down the dethroned Sultan's throat, Iago wallows in luxury before noticing Aladdin trying to steal back the lamp. Abu, Aladdin's monkey, tackles Iago to prevent him from alarming Jafar, which leads to a tussle. As a battle ensues between Jafar and Aladdin, Iago watches sadistically, rooting for Jafar to eliminate the threat, until Jafar wishes to become an all-powerful genie. Unfortunately for Jafar, this means an eternity of slavery and imprisonment, though his greed and lust for power made him oblivious to this.
As Jafar is quickly sucked into his lamp, Iago tries to flee, only to be grabbed by the villain, and dragged into the lamp, as well. Trapped and annoyed, Iago berates Jafar on his foolish decision, just as the two villains are sent to the Cave of Wonders to endure 10,000 years of imprisonment.
- Iago was originally meant to be a snobbish parrot with a British accent. However, to further the comedy, his character was changed drastically to what animator Will Finn calls "Gilbert Gottfried as a parrot".
- Despite reforming, he is still part of the Disney Villains franchise.
- Iago was originally to be voiced by Danny DeVito, but he was unavailable. Devito would be the voice of Phil in Hercules, also directed by John Musker and Ron Clements.
- According to actor Jonathan Freeman (Jafar), the original idea was that Iago would sound like Jafar, meaning that Jonathan would have to play the two characters. However, the people at Disney changed their mind.
- Jafar mentions that he bought Iago from the bazaar; it's never made fully clear whether Iago was capable of coherent speech before being purchased, or whether magical experiments made him so.
- Iago is the first villain in Disney history to lastingly reform in a production other than his debut film. Among the few other characters to have this distinction are Anastasia Tremaine from Cinderella and Gantu fromLilo & Stitch.
- Iago claimed in Return of Jafar that he had a wife and three unhatched eggs. However, as this was meant to be a desperate plea to get Abu to unlock the cage, it's unknown if Iago was being honest about it or not. It's likely he was lying, as he later gets a love interest in the TV show.
- Iago is the first villain sidekick to turn on and kill his former partner, the only other case being Shenzi, Banzai, and Ed and the other hyenas, though only in Iago's case had he actively reformed and was doing it on behalf of the other protagonists.
- In the episode, "When Chaos Comes Calling", Iago's head turns into that of his voice actor, Gilbert Gottfried.
- While in service to Jafar, Iago proved to be one of the more competent henchman: he successfully retrieved the lamp for Jafar after easily tricking Aladdin by mimicking Jasmine's voice; he came up with a number of excellent schemes for Jafar to seize power; and despite his comedic demeanor, he did not display (at least in the first film) any signs of genuine stupidity, despite getting injured from time to time, and he can also be rather sadistic, as he suggested murdering the Sultan and Jasmine in the event that Jafar would manage to marry her, namely "drop [them] off a cliff."
- In the episode "Do the Rat Thing", when Iago was a lizard, his appearance resembled Frank the lizard from The Rescuers Down Under.
- In the Castillian Spanish version, he speaks with a Mexican accent because his voice actor was born in Mexico.
- In the Aladdin episode, Moonlight Madness, Iago was said to have a cousin named Jeff.