Low Ni alumina-forming austenitic (AFA) heat-resistant steel is an advanced high-temperature stainless steel with reduced cost, good machinability, high-temperature creep strength, and high-temperature corrosion resistance. Using the First-principles approach, this study examined the effect of Mn content on austenite stability and mechanical properties at the atomic level. Adding Mn to low Ni-AFA steel increases the unit cell volume with an accompanying increase in the absolute value of formation energy; the austenite formed more easily. The austenitic matrix binding energy decreases and remains negative, indicating austenite stability. As the Mn content increases from 3.2 to 12.8 wt%, the system's bulk modulus (B) rises significantly, and the shear modulus (G) falls. In addition, the system's strength and hardness decrease, and the Poisson ratio of the austenite matrix increases with improved elasticity; the system has excellent plasticity with an increase in the B/G. For the Fe22–Cr5–Ni3–Al2 system, with the increase of Mn content, the electron density distribution between the atoms is relatively uniform, and the electrons around the Mn atoms are slightly sparse, which will slightly reduce the structural stability of the matrix. The experiment demonstrated the matrix maintains the austenitic structure when adding 3.2–12.8 wt% Mn elements to low Ni-AFA steel. At an Mn content of 8 wt%, the overall mechanical properties of the high-Mn AFA steel are optimal, with a tensile strength of 581.64 MPa, a hardness of 186.17 HV, and an elongation of 39%.