Dual phase (DP) steels was investigated using thermomechanical processes designed to obtain ultrafine/nanoferrite-carbide aggregates and martensite–ferrite duplex starting structures prior to intercritical annealing. The effects of processing parameters such as intercritical annealing temperature and time on the microstructural evaluations, mechanical properties, strain hardening behaviors and fracture mechanisms have been studied. The ferrite grain size and martensite volume fraction were depended on the initial microstructure and thermomechanical processing parameters. Ultrafine grained DP (UFG-DP) steel with an average grain size of about 2 μm was achieved by short intercritical annealing of the 80% cold-rolled duplex microstructure. Tensile testing revealed an excellent strength–elongation balance (UTS×UE>110 J cm⁻³) in the DP steels. The new UFG-DP steels showed superior mechanical properties in comparison with the commercially used high strength steels. The variations of strength, elongation, strain hardening behavior and fracture mechanism of the specimens with thermomechanical parameters were correlated to microstructural features.