Abstract: We applied the thermodynamic principle to analyze the thermodynamic condition for deoxidizing the oxide of Si-Mn. According to our result, we designed a new technigue, the surface of water-atomized Si-Mn steel powder deoxidized in pure N₂ with thermoset resin. With the steel powder maintained at 1280℃ or 1330℃ about 120 minutes, the oxygen content can be decreased from about 3060 to 300P.P.M. In the meantime, we determined the relationship between the amount of the oxygen in steel powder and that of the resin in this reducing process. In this way,we solved the deoxidizing problem of water-atomized steel powder that contains Si, Mn and other difficult reduction elements undernon-Vacuum condition.