In this study, we present an approach for ethylene oxide (EO) production that addresses environmental concerns by eliminating greenhouse gas emissions. Our catalyst, Fe2O3/MSM, was synthesized using a hydrothermal method, incorporating Fe2O3 nanoparticles into a well-structured mesoporous silica matrix (MSM). We selected peracetic acid as the oxidant, enabling CO2-free EO production while yielding valuable by-products such as acetic acid, monoethylene glycol, and diethylene glycol. X-ray diffraction (XRD), X- ray photoelectron spectroscopy (XPS), and Brunauer-Emmett-Teller (BET) analyses confirmed the heteroatom structure of the catalysts and porosity, while Transmission electron microscopy (TEM) analysis provided insights into its morphology. Then, the synthesized catalyst was used in the liquid-phase epoxidation of ethylene for EO production. Our systematic experiments involved varying critical parameters such as temperature, ethylene to oxidant ratio, catalyst dosage, and solvent to optimize EO selectivity and ethylene conversion. The results of this study demonstrated an 80.2% ethylene conversion to EO with an EO selectivity of 87.6%. The production process yielded valuable by-products without CO2 emissions, highlighting its environmental friendliness.