Room-temperature sodium-sulfur batteries have significant potential for large-scale applications due to the low cost and high energy density of both sulfur and sodium. Nevertheless, the insulating nature of sulfur and the shuttle effect are impeding their practical application. Here we report that dispersed single-atom Fe sites anchored on a nitrogen-doped carbon matrix present an atomic-level strategy for the development of sulfur hosts. The electronic structure of sulfur is modified by the atomically dispersed Fe-N4 sites, which can transfer the electron to sulfur, thereby enhancing its reactivity. The S@Fe1-NMC cathode delivers a high reversible capacity of 1,650 mAh g−1 initially and 540 mAh g−1 after 500 cycles at 100 mA g−1. A dual function mechanism is observed on S-Fe-N4 sites, which can activate the polysulfides by weakening the S-S bonds and accelerate Na+ diffusion into Na-poor regions to engender a high driving force for Na2Sx decomposition, thus inhibiting the shuttle effect.