Abstract: By using TEM the strain-induced precipitation of Nb(CN) during deformation of under cooled austenite was investigated in Nb-microalloyed steel. The results showed that at 1200℃ all of Nb were dissolved and there were no Nb(CN) precipitates formed during cooling until down to 760℃. During deformation-enhanced ferrite transformation the Nb(CN) of dynamic precipitation required an incubation period, but compared with isothermal transformation it reduced significantly. Only when the strain increased to 0.69, Nb(CN) began to precipitate on dislocation nodes and grain boundaries. The volume fraction of Nb(CN) precipitates increased with the increase of strain but their coarsening was not significant. It is shown that the measured grain size is in good agreement with the calculated value.