Pyrite, the most common sulfide mineral, is a ubiquitous component of many hydrothermal gold deposits. Geochemical patterns within the refractory pyrite structure represent a valuable repository of information that can help constrain the sources of ore-forming materials, and the evolution of ore-forming processes over time. However, there are still a lot of debates on the mechanisms of physico-chemical processes in ore-forming fluid controlling trace element and sulfur isotope distributions in pyrite during growth. In our manuscript, we use cutting-edge complementary microanalytical methods to understand the origin and evolution of zoned gold-bearing pyrite in samples from the largest gold deposit in the Ailaoshan gold belt, SW China, Zhenyuan (exceeding 100t Au, average grade: 5.3 g/t). Pyrite, arsenopyrite, chalcopyrite, and stibnite are the most abundant sulfide minerals in most orebodies. Of these, pyrite is dominant and is also the most important host for gold. Two types of pyrite can be clearly distinguished: framboidal pyrite and hydrothermal pyrite. Gold is most commonly hosted by hydrothermal pyrite. Framboidal pyrite, mainly hosted by carbonaceous slate, hosts negligible Au, and features low δ³⁴S values ranging from − 35.0 (± 0.9) to − 25.6 (± 1.0)‰. Hydrothermal pyrite is characterized by complex intra-grain zoned textures with alternating As-rich and As-poor bands readily recognizable on backscattered electron images. Scanning electron microscopy and trace-element analyses show that both visible and invisible gold occur only in the As-rich bands. Compared to the As-poor bands (72.1% of Au concentration data < 1.96 ppm, n = 43), the As-rich bands are characterized by far higher concentrations of Au (up to 1420 ppm), Cu, Ag, Sb, and Tl, but lower concentrations of Co and Ni. In-situ sulfur isotope analysis indicates that the δ³⁴S values of As-rich zones range from − 7.3 (± 0.6) to 2.9 (± 0.6)‰ and are similar to those of As-poor zones (from − 6.9 (± 0.7) to 2.8 (± 0.6)‰), but distinct from the framboidal pyrite. Combined with published fluid inclusion data and a probable age for the magmatic event associated with mineralization, these data suggest that magmatic–hydrothermal fluids contributed most ore-forming materials and that periodic boiling led to formation of the rhythmic As-rich and As-poor bands in pyrite. Our data for pyrite constrain the evolution of ore-forming processes and provide new insights into the formation of zoned pyrite, with the conclusions having broad implications for analogous hydrothermal gold deposits worldwide.