The invention discloses a method for deep reduction and magnetic separation of nickel and iron in lateritic nickel ore carbon-containing pellets. The method aims at realizing deep reduction calcination and magnetic separation, and has obvious nickel and iron enrichment effects. The method comprises the following steps of carrying out crushing and abrasive cleaning of lateritic nickel ores by a jaw crusher and a ball mill, removing soil, carrying out dehydration and drying by an oven, adding a reducing agent, CaO as a flux and a composite binder into the dried lateritic nickel ore particles, feeding the mixture into a damp mill to obtain the uniform mixture, feeding the uniform mixture from the damp mill into a disc-shaped pelletizer for pelletizing, respectively carrying out drying, preheating and calcination by a grate and a rotary kiln, throwing the calcined pellets into a sealed channel of a cooling water tank, wherein an annular air cooler is arranged around the sealed channel, feeding heat carried by the calcined pellets back to the grate for use by the annular air cooler, carrying out water quenching of the calcined pellets falling into the cooling water tank so that the calcined pellets are crushed automatically, dragging nickel, iron and slag in the cooling water tank by a slag dragging machine and feeding them into the ball mill for fine grinding, directly feeding theobtained nickel and iron ore powder into a magnetic separator for separation, drying the separated nickel and iron ore powder by an oven, packaging the dried nickel and iron ore powder, warehousing the packaged nickel and iron ore powder, drying the separated nonmagnetics by an oven, and warehousing the dried nonmagnetics as magnesium raw materials.