Mechanical Alloying (MA) treatment is an effective technique in terms of ultra-grain-refining within powder particles and fabrication of alloy powders. In this study, a new powder metallurgy process using MA treatment was proposed for the fabrication of fine-grained high nitrogen stainless steels. Chromium nitride (Cr2N) powder was mixed with Fe-Cr binary alloy powder to control its mean chemical composition to be Fe-23mass%Cr-1mass%N which is enough to stabilize austenitic structure at room temperature. The powder mixture was mechanically milled up to 360ks in an argon gas atmosphere to produce an alloyed powder (MA powder). MA powder was packed in a stainless steel tube in a vacuum and consolidated by hot rolling at 1073 K. The bulk material was finally heated to various temperatures (1173-1473K) and then quenched without holding at the temperature. The structure of bulk materials heated to the temperature below 1323K is of (bcc+Cr2N) at room temperature, and the materials treated above 1373K has the structure of (fcc+Cr2N). For instance, the materials treated at 1473K has fine austenitic structure of the grain size of 2.2μm due to finely dispersed Cr2N particles in matrix and contains 0.86 mass% nitrogen in solid solution. The austenitic steel has very high yield strength of 1.1 GPa and enough elongation of 30%. Such a high strength is due to solid solution strengthening by nitrogen and grain refining strengthening of the matrix.