This paper proposed a simple and fast method of induction heating and quenching to produce surface gradient structure for S38C steel, and its mechanical behavior and strengthening mechanism have been revealed. The variation of the gradient structure from surface to interior was characterized by electron backscatter diffraction, and the tensile behavior of the gradient structure at different depths has been acknowledged by the small‐scale tensile tests. The gradient structure was tempered martensite microstructure, which significantly improved the hardness and tensile strength of surface and subsurface regions. Accordingly, with the strengthening of the gradient structure, the general tensile strength and fatigue behavior of the S38C steel were increased close to those of high‐strength steel. Moreover, the fatigue crack initiation mechanism of the gradient structure was studied by energy dispersive spectroscopy, transmission Kikuchi diffraction and transmission electron microscope characterization on the crack initiation regions. It revealed that the fatigue failure of the gradient structure could be due to stress concentration in surface and around subsurface inclusions, and the crack initiation modes presented surface crack initiation and internal crack initiation, respectively.This article is protected by copyright. All rights reserved.