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The microstructure and mechanical properties of M50 steel subjected to combining cold rolling (CR) with austempering are investigated. The microstructure is characterized using X-ray diffraction and scanning and transmission electron microscopy. The mechanical properties are measured using the uniaxial tensile and Charpy impact tests. It is observed that an excellent combination of ultimate tensile strength (2536 MPa) and impact toughness (128 J) was achieved by combining austempering with CR; of which the ultimate tensile strength increased by 10% compared with traditional martensite quenching-tempering (Q-T) specimen and the impact absorbed energy exhibited 2.3 times of that in Q-T specimen. The observation of the microstructure indicates that CR obviously refines the thickness of bainite sheaves, which is favorable for the formation of ultrafine equiaxed ferrite during tempering.