Surface-hardened layer characteristics and fatigue strength properties of transformationinduced plasticity-aided martensitic steels subjected to heat-treatment or vacuum carburization followed by fine-particle peening are revealed for automotive applications specially for powertrain parts. The as-heat-treated steels without the case-hardening process possess excellent impact toughness and fatigue strength. When the steels are subjected to fine-particle peening after heat-treatment, the fatigue limits of smooth and notched specimens increase considerably, accompanied with low notch sensitivity. Vacuum carburization and subsequent fine-particle peening increases further the fatigue strength of the steels, except notch fatigue limit. The increased fatigue limits are principally associated with high Vickers hardness and compressive residual stress just below the surface, resulting from the severe plastic deformation and the strain-induced martensitic transformation of metastable retained austenite, as well as low surface roughness and fatigue crack initiation depth.