Mitigation measures are needed for reducing chronic dissolved phosphorus (P) losses from agricultural soils with a legacy of excessive P inputs to surface waters. Since pipe drains are an important pathway for P transport from agricultural soils to surface waters in flat areas, removing P from drainage water can be an effective measure. During a 4.5 year-field experiment, we tested the performance of a pipe drain enveloped with Fe-coated sand for removing soluble P from drainage water. Iron-coated sand is a by-product of the drinking water industry and has a high ability to bind P. The P concentration in the effluent from the enveloped pipe drain remained at a very low level over the entire monitoring period, with a removal percentage amounting to 93% for total P. During the field experiment, the enveloped pipe drain was below the groundwater level for a prolonged time. Nevertheless, no reduction of Fe(III) in the Fe-coated sand occurred during the first two years, most likely due to preferential reduction of Mn oxides present in the coatings of the sand particles, as reflected in elevated effluent Mn concentrations. Thereafter, reductive dissolution of Fe oxides in the coatings caused a gradual increase in the Fe concentration in the enveloped pipe drain effluent over time. Concomitantly, the dissolved Mn concentration decreased, most probably due to the depletion in easily accessible Mn oxides in the Fe-coated sand. The Fe in the Fe-coated sand was identified as silicate-containing ferrihydrite (Fh). The submerged conditions of the enveloped pipe drain neither affected the stability of Fh in the Fe-coated sand nor the ability of this measure to capture P from drainage water. Enveloping pipe drains with Fe-coated sand is an effective method for reducing dissolved P inputs from agricultural soils to surface waters and holds great promise for implementation in practice.