Abstract: The microstructure evolution of Q235 plain carbon steel in multi-pass hot deformation was investigated by means of hot compression simulation. The results indieate that fine ferrite grains of 4-5 μm can be achieved by deformation enhanced phase transformation of undercooled austenite in combination with austenitic recrystallization. The yield strength exceeded 400 MPa and the plastic elongation was over 40%. By proper heat treatment after deformation the scattered minor microstructures of cementite and pearlite were distributed on the grain boundaries of fine ferrite grains. The yield ratio was effectively decreased without loss of yield strength and the ductility.