We analyze the mechanisms leading to a highly diffractive fixed hologram in photorefractive Fe-doped lithium niobate crystals by simultaneous self-stabilized holographic recording and compensation at moderately high temperatures. We show that a partially compensated running hologram is produced during recording under this condition and discuss the performance of the process in terms of the operating temperature, the degree of oxidation ( \left[{\mathrm{Fe}}^{\mathrm{3+}}\right]/\left[{\mathrm{Fe}}^{\mathrm{2+}}\right] ratio) of the sample, and the effect of the absorption grating arising from the spatial modulation of the {\mathrm{Fe}}^{\mathrm{2+}} concentration produced during photorefractive recording. We experimentally measure the evolution of the uncompensated remaining hologram during recording and the evolution of the diffraction efficiency of the fixed hologram during white-light development and show that the maximum fixed grating modulation to be achieved is roughly limited by Fe-dopant saturation. A reproducible \eta \approx 66\% efficiency fixed grating was obtained on a sample exhibiting an otherwise maximum fixed \eta \approx 3\% when using the classical three-step (recording at room temperature—compensating at high temperature—developing at room temperature) process.