The effects of austenitizing temperature were investigated on the microstructure and mechanical properties of 12% Cr steel. Low-temperature austenitizing below 1 000-degrees-C induced the carbide coarsening during subsequent tempering at 750-degrees-C for 1 hr due to the nucleation effect of undissolved M23C6. The large and spheroidized carbides enhanced the subgrain growth. On the other hand, the complete dissolution of M23C6 above 1 000-degrees-C caused the fine carbide formation on lath boundaries, which retarded the subgrain growth during tempering. Furthermore, the dissolution of Nb(C,N) above 1 100-degrees-C enhanced the tempering resistance through increasing the stability of lath morphology and reducing the growth rate of M23C6. The increase in strength with increasing austenitizing temperature was attributed to the fine carbide distribution and the high dislocation density. Further, as the austenitizing temperature increased, the impact energy markedly reduced, due to the large prior austenite grain size and the high strength.