NM550 wear-resistant steel is widely used in large-scale engineering and mining machinery under extremely harsh working conditions. In NM550 steel, the addition of Ti can cause the formation of micron-scale TiN and TiC inclusions, easily triggering cleavage fractures. The fracture behavior and precipitation rule of micron-scale TiN and TiC inclusions on the tensile process in NM550 steel was investigated by scanning electron microscopy, transmission electron microscopy, and energy spectrum analysis combined with thermodynamic theory. The TiN precipitated in the solid–liquid two-phase region at a precipitation temperature of 1710 K, whereas that of TiC was 1158 K along the austenite grain boundary. The sizes of the TiN precipitated in the liquid phase and the TiC precipitated in austenite were both at the micron scale, which is prone to cleavage fracture during the stretching process. Under tensile stress, microcracks were first initiated at the TiN inclusion, which were further separated forming a hole, whereas the TiC inclusion was divided into two sections with a long and narrow gap formed between the substrates. The sizes of the TiN and TiC were related to the cooling rate, Ti, and N contents. The larger the cooling rate and the lesser the Ti and N content, the smaller the TiN and TiC sizes.