As Jafar's servant, Iago is normally seen on Jafar's shoulder and takes an active role in his master's schemes, such as stealing Genie's lamp from Aladdin. During Jafar's battle with Sora, he holds the lamp to keep it away from the latter, as the lamp was one of the ways to damage Jafar. Iago tries to fly away at the downfall of Jafar, but ended up in the lamp as well.
Kingdom Hearts: Chain of Memories
Iago made a small cameo appearance in Kingdom Hearts: Chain of Memories, holding the lamp during the Jafar boss battle, like in the first game. He was also how Jafar got his hands on the lamp in this game to control Genie.
Kingdom Hearts II
Eventually, Iago was free from Jafar's lamp. When he encountered Sora and the others again, he tried to convince them that he had turned over a new leaf, although only Goofy seemed to believe him until Iago saved the group from a bunch of Heartless.
Iago wanted to prove to Aladdin that he was no longer a villain. He did so by taking Jafar's lamp from Pete, which proved his loyalty, until Jafar was released and he was forced to trick Sora, Donald, Goofy, and Aladdin into going to the ruins, thereby destroying any trust he had obtained. When the group returned to Agrabah to face Jafar, Iago blocked an attack aimed at Aladdin and proved himself a friend again.
Kingdom Hearts coded
Iago helps Jafar steal the Genie's lamp, which Sora must get back. He also appears in the final boss fight, once again holding Jafar's lamp.
Iago is a cowardly parrot, who is often frustrated and vocalizes his anger freely. Iago is scared quite easily, especially by the person he fears the most—Jafar. Iago is very loyal to Jafar, mainly due to the immense fear of punishment he would receive should he fail his master. Although Iago gives off a "tough guy" exterior, he has a good heart, as seen in the second return to Agrabah in Kingdom Hearts II, when Iago shields Aladdin from one of Jafar's attacks, nearly sacrificing himself.
Though it is not mentioned in the movie or games what species of parrot Iago is, he strongly resembles a plump scarlet macaw. Most of his plumage is red, except for his tail and the tips of the first four feathers on each wing (Iago uses these feathers as "fingers"). Iago's sclera are yellow and his eyes are surrounded by a white, featherless area. He also has a large, yellow-orange beak and orange talons. His similarities to real-world birds end there, however. Iago's talons have three toes arranged in such a way that he has two in the front and one in the back, as opposed to real macaws having four toes, two in the front and two in the back. He has a thick black "uni-brow" and three thin, black feathers sprouting out of the top of his head. Iago's eyes are also set facing forward, unlike any species of macaw (and most species of birds). Arguably the biggest difference between Iago and other birds is the fact that he has straight, white teeth in his beak like a human, and his tongue is rather human-like as well.
Iago originally appeared in the 1992 film Aladdin. In the film, he is Jafar's parrot and spy, helping Jafar with his plan to marry Jasmine and become sultan of Agrabah. While in the presence of others, Iago uses speech appropriate for a normal parrot instead using fluent language. As shown throughout the film, the Sultan is fond of Iago and frequently feeds him crackers, something that Iago despises. When Aladdin goes into the Cave of Wonders to retrieve Genie's magic lamp, Iago steals it from him and gives it to Jafar. After Aladdin's arrival at the palace in disguise a prince, Jafar discovers his true identity and sends Iago to find the lamp and bring it to him, which he did successfully. When Aladdin sneaks into the palace to take Genie's lamp back, Iago spots and attempts to warn his master, but is swiftly silenced by Abu. In the climactic battle, Iago briefly fights Abu until Abu knocks him out for a few moments. Once Jafar is tricked into wishing to be a genie, he is sucked into his new lamp and Iago tries to flee from the scene, but is grabbed by Jafar and trapped inside the lamp along him. At the end, Iago is heard arguing with his master inside the lamp, having lost his patience with him.
In The Return of Jafar, Iago escapes from the lamp and he switches sides, mostly because he is tired with being pushed around by Jafar. Over the course of the film, Iago slowly warms to the idea of friendship after Aladdin saves him from the Sultan's wrath in return for Iago unintentionally saving him from Abis Mal, finally risking his life to kill Jafar by pushing his lamp into molten lava. After his heroic deed, he is welcomed into Aladdin's extended family.