The present work deals with the dilatometric study of a hot-rolled 0.2C3Mn1.5Si lean medium Mn steel, mainly suitable for the quenching and partitioning (Q&P) heat treatment in both hot-rolled or cold-rolled condition, subjected to a variation of austenitization temperature. These investigations were performed in a temperature range of 800–1200 °C. In this context, the martensite transformation start temperature (Ms) was determined as a function of austenitization temperature and in turn obtained prior austenite grain size (PAGS). The results show rise in prior austenite grain size due to increasing austenitization temperature, resulting in elevated Ms temperatures. Measured dilatation curves were confronted with the metallographic analysis by means of scanning electron microscopy (SEM). The present paper also focuses on the construction of a continuous cooling transformation (CCT) and deformation continuous cooling transformation (DCCT) diagram of the investigated lean medium Mn steel in a range of cooling rates from 100 to 0.01 °C/s and their subsequent comparison. By comparing these two diagrams, we observed an overall shift of the DCCT diagram to shorter times compared to the CCT diagram, which represents an earlier formation of phase transformations with respect to the individual cooling rates. Moreover, the determination of individual phase fractions in the CCT and DCCT mode revealed that the growth stage of ferrite and bainite is decelerated by deformation, especially for intermediate cooling rates. Microstructural changes corresponding to cooling were also observed using SEM to provide more detailed investigation of the structure and present phases identification as a function of cooling rate. Moreover, the volume fractions obtained from the saturation magnetization method (SMM) are compared with data from X-ray diffraction (XRD) measurements. The discussion of the data suggests that magnetization measurements lead to more reliable results and a more sensitive detection of the retained austenite than XRD measurements. In that regard, the volume fraction of retained austenite increased with a decrease of cooling rate as a result of larger volume fraction of ferrite and bainite. The hardness of the samples subjected to the deformation was slightly higher compared to non-deformed samples. The reason for this was an evident grain refinement after deformation.