Abstract The effects of cold working and aging on a two-phase (austenite and ferrite) Fe-27.3wt.%Mn-6.7wt.%Al-0.22wt.%C alloy were studied using differential scanning calorimetry (DSC) and isochronal annealing at different temperatures. Reactions were detected by DSC at 145 °C, 346 °C, 531 °C and 630 °C. Both the reactions at 145 °C and 346 °C are controlled by the diffusion of carbon. The products of both reactions can be described as carbon atoms segregated to interstitial sites around manganese and aluminum atoms forming very small carbon-rich clusters which are structurally coherent with the parent solid solution and are too small to be detected by transmission electron microscopy (TEM). The clusters formed in ferrite at 346 °C induce an internal stress causes an increase in the hardness of the ferrite. The reactions at 531 °C and 360 °C are controlled by the diffusion of manganese and aluminum. The reaction at 531 °C evidently was a homogeneous nucleation of precipitate with the same crystal structure as ferrite. At 620 °C, the latter homogeneously nucleated precipitate transforms into austenite.