Using a density functional approach, we study structural and magnetic properties of small Fe-n clusters (nless than or equal to8) deposited on a MgO(100) substrate. Upon deposition, the clusters closely preserve their gas-phase structure. The magnetic moments for the adsorbed clusters exceed the value for bulk Fe. Compared to the gas phase, significant reductions in the magnetic moments are found for Fe-n clusters with nless than or equal to6. These reductions result from intracluster charge rearrangements caused by interaction with O 2p orbitals, rather than from structural deformations or charge transfer from the surface. As the cluster size increases, the gas-phase magnetic moments are recovered.