A fine grained microduplex steel (25. 7 Cr - 6. 6 Ni) was deformed in tension at 700-910 degree C over the strain rate range of 2 multiplied by 10** minus **6 to 2 multiplied by 10** minus **3 s** minus **1. Microstructural investigation was made after static and dynamic annealing. The grain growth and evolution toward equiaxed grain were faster during dynamic annealing as compared to those during static annealing. The former process dominates at higher temperatures and intermediate strain rates, but the observed strain hardening can only partly be accounted for by the grain growth.