Local magneto-optical imaging and global magnetization measurement techniques were used in order to visualize shielding effects in the superconducting core of MgB_2 wires sheathed by ferromagnetic iron (Fe). The magnetic shielding can provide a Meissner-like state in the superconducting core in applied magnetic fields up to ~1T. The maximum shielding fields are shown to correlate with the saturation fields of magnetization in Fe-sheaths. The shielding has been found to facilitate the appearance of an overcritical state, which is capable of achieving a critical current density (J_c) in the core which is larger than J_c in the same wire without the sheath by a factor of ~2. Other effects caused by the magnetic interaction between the sheath and the superconducting core are discussed.
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