Steel has many advantages over iron, including being harder, more malleable and less brittle. Before steel was created in 1856, the two main types of iron were wrought iron and cast iron, each of which had its own disadvantages.
When iron ore is heated to extreme temperatures, it begins to absorb carbon, which creates cast iron after it is melted and then cooled. The addition of carbon to the iron ore produces a much stronger metal, but also makes cast iron very brittle and nonmalleable. Still, this was the only type of iron available until 1784, when Henry Cort discovered how to decrease the carbon content to produce wrought iron.
By lowering the carbon content, Cort was able to produce iron that was much less brittle and more malleable that cast iron. However, wrought iron also doesn't have near the hardness or strength of cast iron, making it unsuitable as a building material.
In 1856, Henry Bessemer discovered a way to introduce oxygen into the molten iron in order to more effectively reduce the carbon content of cast iron. The result was steel, which has a carbon content in between that of cast and wrought iron. By balancing the amount of carbon, Bessemer produced a metal that was extremely strong and flexible, making it an ideal building material.