The fly ash from the Corner Brook Pulp and Paper (CBPP) mill was used in this study as the raw material for the preparation of a low-cost adsorbent for arsenic removal from the well water of Bell Island. The CBPP fly ash was physically activated in two different ways: (a) activation with pure CO2 (CAC) with the iodine number and methylene value of 704.53 mg/g and 292.32 mg/g, respectively; and (b) activation with a mixture of CO2 and steam (CSAC) with the iodine number and methylene value of 1119.98 mg/g and 358.95 mg/g, respectively, at the optimized temperature of 850 °C and the time of 2 h for both activations. The BET surface areas of the CAC and CSAC at the optimized conditions were 847.26 m2/g and 1146.25 m2/g, respectively. The optimized CSAC was used for impregnation with iron (III) chloride (FeCl3) with different concentrations (0.01 M to 1 M). The study shows that the adsorbent impregnated with 0.1 M FeCl3 is the most efficient adsorbent for arsenic removal. Isotherm analysis shows that the Langmuir model better describes the equilibrium behavior of the arsenic adsorption from both local well water and synthesized water compared to the other models. The maximum arsenic adsorption capacity was 35.6 μg/g of carbon for local well water and 1428.6 μg/g of carbon for synthesized water. Furthermore, the kinetic behavior of arsenic adsorption from synthesized and local well water was well depicted by the pseudo-second order kinetic model.