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The effect of microstructure on the stress-strain behaviour of pipeline steels was studied. Slow strain rate (2×10-6 s-1) tests were conducted on grade X65 and X100 steels in silicone oil and hydrogen carbonate/carbonate solution. The as-received grade X100 steel at 75°C showed serrated stress-strain curves. The magnitude of the serrations depended upon the strain rate and test temperature. Annealing at 600°C or above removes the serrations, but this increased the susceptibility to transgranular cracking in hydrogen carbonate/carbonate solution at potentials below −800 mV (sce). The removal and reformation of banding in pipeline steels were also studied. Ferrite/pearlite becomes aligned during the hot rolling stage of pipe manufacture and causes directionality in crack propagation and mechanical properties. Heat treatments were carried out which show that banding in grade X65 and X100 can be removed above 900°C. This depends on homogenisation of carbon which also depends on temperature, time, and cooling rate.