The effects of fine-particle peening conditions on the surface-hardened layer properties of newly developed case-hardening steel, i.e., transformation-induced plasticity-aided steel with a chemical composition of 0.2% C, 1.5% Si, 1.5% Mn, 1.0% Cr, 0.2% Mo, and 0.05% Nb (mass%) were investigated for the fabrication of automotive drivetrain components. The surface roughness decreased with decreasing archeight of fine-particle peening after vacuum carburization. A white layer developed on the surface of the steel peened at arc-heights greater than 0.41 mm (N). The maximum Vickers hardness and maximum compressive residual stress increased with increasing arc-height in the steel. These values were higher than those of commercial case-hardening steels. The increased volume fraction and expansion strain of the strain-induced martensite increased the hardness and compressive residual stress in the surfacehardened layer of the steel, although severe plastic deformation made a substantial contribution to enhancing the surface-hardened layer properties.