Rusting of iron is an example of physical change.

In a physical change, no change occurs in the chemical properties of the matter. In other words, no new substance gets formed. Only physical properties, such as size and shape change. 
On the other hand, a change in which new substances are formed is called a chemical change. When an iron piece is exposed to moisture, rust formation takes place.  A new substance rust gets formed. Thus, rusting of iron is an example of chemical change.