In this study, the Fe-16Mn-9Al-0.8C-3Ni (wt.%) lightweight steel was fabricated by novel twin-roll strip casting technology. The microstructure, tensile properties and strain-hardening behavior of the present steel have been investigated and compared to those of conventionally processed steels with similar chemical compositions. After annealing, a unique gradient microstructure of intermetallic compound (B2)-austenite was obtained along the thickness direction, consisting of granular B2 (average: 430 nm) and fine austenite (average: 1.82 μm) at the surface layer, blocky B2 (average: 1.03 μm) and medium austenite (average: 3.98 μm) at the quarter layer and polygonal B2 (average: 1.94 μm) and coarse austenite (average: 6.13 μm) at the center layer. The cooperative action of B2 pinning dislocation, plane slip and back stress led to stronger strain hardening, among which the strong back stress effect originated from the multistage discontinuous austenite deformation and the mechanical incompatibility between austenite and B2 is believed to be the most important reason, thereby achieving an excellent balance of strength (ultimate tensile strength: 1147 MPa) and ductility (total elongation: 43.2%). This work not only developed a new processing way to fabricate Ni-containing Fe-Mn-Al-C lightweight steel with outstanding mechanical properties, but also provided a potential solution for manufacturing some other metallic materials accompanied by brittle B2 intermetallic.