A series of Fe-substituted ZSM-5 zeolite samples with an almost constant Si/(Fe + Al) molar ratio of 50 but varied levels of Fe substitution were synthesized via an in situ seed-induced hydrothermal method in a fluoride medium. Additionally, a hierarchical Fe-substituted sample with high diffusion capability was also produced by a subsequent alkaline treatment. The textural and acidic properties of these samples were characterized by X-ray diffraction (XRD), scanning electron microscopy (SEM), transmission electron microscopy (TEM), UV-Raman, Fourier transform infrared (FT-IR), UV-vis, H-2-temperature programmed reduction (TPR), Ar adsorption-desorption, NH3-temperature-programmed desorption (TPD), X-ray fluorescence (XRF), Al-27, and Si-29 magic-angle spinning (MAS) NMR analysis. These analyses revealed that Fe3+ species were effectively integrated into the MFI framework of the Fe-substituted samples. The as-synthesized samples displayed orthogonally intergrown crystal plates of increased aspect ratios with increased Fe-substitutions. More significantly, the resulted Fe-substituted samples displayed a noticeably reduced acid strength compared to the pure ZSM-5. Evaluated by the benzene alkylation reaction with dilute ethylene, the 50% partially Fe-substituted ZSM-5 sample showed a combined high ethyl selectivity and long catalytic lifetime among all catalysts studied, which is attributed to its suitably balanced acid strength.