Plasticity behavior and phase transition of metal Fe subjected to shock loading have attracted considerable attention in shock physics community, in particular for underlying relationship between them. Experimental examinations and atomistic simulations on shocked Fe have displayed a three-wave structure: elastic wave, plastic wave and transformation wave. However, these studies are primarily limited to the one-dimensional planar case. Recently, owing to the rapid development of experimental techniques, investigating dynamic property of shocked metal has extended to the multi-dimensional loading conditions, such as cylindrical or spherical shocks. In this regard, fruitful findings are achieved, for example, twinning ratio in polycrystalline Fe under implosive compression is found to be much higher than that under planar shock, implying that the the complex stress state plays a critical role. In this paper, we explore the effects of prestress on plasticity and phase transition of shocked polycrystalline iron. The imposed presstress normal to the impact direction in one-dimensional planar shocking represents the varying deviatoric stress, and does not nearly affect the principal stress. The utilized empirical potential for iron could describe the plasticity dislocation and phase transition very well. The simulations show that as the prestress increases, the shock speed at elastic stage and Hugoniot elastic limit increase, which is in accordance with the theoretical analyses based on shock wave theory and experimental measurement. Meanwhile the plastic wave speed increases more quickly and catches up with the transformation wave more easily, resulting in a steep shockwave front. Atomistic snapshots show that plasticity dislocation stemming from the grain boundary precedes phase transition, where most of BCC atoms are transformed into the HCP atoms and shear stress significantly decreases. Further observations from these images find that plastic zone becomes narrower with increasing prestress, representing a shorter plastic relaxation time, which accelerates the completion of phase transition. This rapid phase transition process is also indicated by quantitatively evaluating the ratio of transitioned closed packed atoms as a function of evolution time. The origin based on the atomistical prediction model of Fe phase transition is attributed to the fact that higher prestress gives rise to the larger von-Mises stress for easier dislocation emission while lower one cannot. But the final transformed atoms are independent of prestress. Additionally, the measured free surface velocity profiles from planar and cylindrical impact loading validate the simulations conducted here. These findings will help to understand experimentally the microscopically dynamic evolution of Fe, imposed by complex stress state.