Powder metallurgy (PM) steel with enhanced density is essential for meeting the demands on high strength and high-performance applications. In this study, cold isostatic pressing (CIP) is applied for consolidating water-atomised iron and Cr-alloyed steel powder to reach about 95% densification before sintering. Additionally, the effect of the lubricant and graphite addition on the compressibility of the different base powder types was evaluated. The maximum green densities of ≈7.55 g cm −3 for iron powder and ≈7.45 g cm −3 for Cr-alloyed powder were reached after CIP at 800 MPa. The sintering at 1250°C with added graphite allowed to achieve increased densification to ≈7.60 g cm −3 for the iron and ≈7.50 g cm −3 for Cr-alloyed grades, respectively. These levels were sufficient for surface pore closure, which allowed the application of the capsule-free hot isostatic pressing (HIP) after sintering to reach full density. This approach paves the way for manufacturing large-sized PM components.