Exfoliation of atomically thin layers from non-van der Waals bulk solids gave rise to the emergence of a new class of two-dimensional (2D) materials, such as hematene (Hm), a structure just a few atoms thick obtained from hematite. Due to a large number of unsaturated sites, the Hm surface can be passivated under ambient conditions. Using density functional theory calculations, we investigate the effects of surface passivation with H and OH groups on Hm properties and demonstrate that the passivated surfaces are energetically favorable under oxygenrich conditions. Although the bare sheet is antiferromagnetic and possesses an indirect band gap of 0.93 eV, the hydrogenated sheets are half-metallic with a ferromagnetic ground state, and the fully hydroxylated sheets are antiferromagnetic with a larger band gap as compared to the bare system. The electronic structure of Hm can be further tuned by mechanical deformations. The band gap of fully passivated Hm increases monotonically with biaxial strain, hinting at the potential applications of Hm in electromechanical devices.