The use of grain refinement methods to improve both strength and toughness of austenitic manganese steels has increased gradually. In this study, a different thermal treatment processing was used to stimulate the formation of ultrafine austenite grains in Fe–0.9% C–14.5% Mn steel with average grain sizes in the range of 60–90 μm. The process involves homogenization, hot rolling, solution treatment, cold rolling, and annealing respectively. Optical microscopy, scanning electron microscopy, X-ray diffraction, and tensile test were used to analyze the microstructure and mechanical properties of specimens. It was found that 50% cold rolling and static annealing at 700 and 750°C for 1 h exhibited ultrafine grained structure with bimodal grain size distribution and dispersive carbide particles. The optimum condition of a significant grain refined structure with improved mechanical properties was obtained after annealing for 1 h at 750°C.