Abstract: The microstructure evolutions during deformation-enhanced transformation of undercooled austenite of Nb-microalloyed steel and low carbon steel with the similar contents of C and Mn were investigated by hot compression simulation experiment. The effect of Nb on the deformation-enhanced ferrite transformation was studied, and the transformation kinetics was analyzed. The results show that Nb(CN) precipitation promotes ferrite nucleation significantly before deformation-enhanced ferrite transformation. Ultra-fine ferrite with a grain size of about 1.9 μm is formed in Nb-microalloyed steel during deformation of undercooled austenite between A₃-A_r³. Deformation-enhanced transformation is the dominated process in the early stage of deformation; as ferrite transformation accomplished, the ferrite grain size of Nb-microalloyed steel is smaller than that of low carbon steel.