The new type SFG HSS (super fine grain, high strength steel sheet) has been developed by adding solid-solution strengthening elements to conventional IF steel such as Si, Mn. The precipitation behavior of the second phase particles was observed and studied by a carbon extraction replica technique used transmission electron microscopy (TEM). The shape of the small second particles is similar to spherical and ellipse, the sizes of which are 10~30nm. It is seen that the particles are dispersed on the matrix. The precipitate composition of small particles is Nb (CN) and the precipitate composition of large particles is NbC examined by energy dispersive X-ray (EDX). It is noted that the yield strength is low as well as the tensile strength is high by the PFZ which is free of precipitate called precipitated free zone on the one side of the grain boundary. The results of microstructure shows that the second phase particles pinned on grain boundary not only can inhibit the grain growth, but also the grain can be fined.