A green and sustainable approach to recycle the waste iron rust into a valuable α modification of Fe2O3 via simple grinding and calcination for application in hybrid supercapacitor is reported. The α-Fe2O3 was coupled with conducting polymer carbon nanofibers (CNF) and Poly aniline (PANI) to form composite hybrid supercapacitor electrode materials. The conventional hydrothermal, electro-spinning processes were used to prepare composites. X-ray diffraction, Transmission Electron Microscopy (TEM), High Resolution Transmission Electron Microscopy (HRTEM), Selected Area Electron Diffraction (SAED), Scanning Electron Microscopy and Energy Dispersive X-Ray spectroscopy were used to study the structural, morphological and compositional properties of as synthesised α-Fe2O3 and its composites with CNF and PANI. The α-Fe2O3/CNF and α-Fe2O3/PANI composites coated on carbon rod were used as electrodes in a three-electrode system to study Electrochemical Impedance Spectroscopy, Cyclic Voltammetry and Galvanostatic Charge-Discharge in 1M H2SO4. It is observed that α-Fe2O3/PANI exhibit higher response as against α-Fe2O3/CNF with respect to specific capacitance; 192.29 Fg-1 (88.88 Fg-1), energy density; 11.28 WhKg-1 (3.084 WhKg-1) power density; 162.44Wkg-1 (69.39 Wkg-1) with capacitance retention of 80% (75%). The heavy dispersion of α-Fe2O3 over long CNF and PANI fibres with intimate contact resulted in abundant active sites for electrochemical reactions leading to obtained result. The rust derived α-Fe2O3 with PANI offer excellent stability to act as potential candidate for sustainable hybrid supercapacitor application.