Medium manganese steels belong to the group of third generation high-strength steels. These steels show an excellent combination of strength and ductility. Their manganese content ranges from 3 to 12%. After hot forming, the structure is usually martensitic. During intercritical annealing, martensite partly transforms to austenite. The choice of the correct alloying and intercritical annealing parameters, especially the heating temperature, leads to sufficiently stable retained austenite, which significantly affects the mechanical properties. The retained austenite exhibits TRIP effect during cold deformation and contributes to a significant deformation strengthening of the material.Medium manganese steel with 0.2% C, 5% Mn and 3% Al was subjected to various intercritical annealing regimes after hot forming. To increase the stability of the retained austenite, isothermal hold at different temperatures was performed in the bainitic transformation region. To verify the effect of deformation, incremental deformation was applied during cooling. After processing, martensitic structures were obtained with varying fractions of bainite, ferrite and retained austenite. The ultimate tensile strength up to 1940 MPa was reached and the elongation was about 10%.