The aim of this paper is to examine the attainments and challenges of the iron and steel industry in Viet Nam. The demand for steel in Viet Nam is increasing, with focus on construction steel. While low-level industrialization is a restraining factor for the industry, the economic structure with high steel intensity is a promotional factor. Steel production is increasing in line with domestic demand. Private and foreign-affiliated enterprises are the main players in the expansion of steel production. Market selection based on survival of the fittest is working well. In general, the transition to a market-oriented economy is showing considerable results in Viet Nam. However, the industry still faces some challenges. While the low operating ratio due to overcapacity is a by-product of market-oriented reform rather than governmental intervention, the poor performance and governmental support of state-owned enterprises show insufficiency of reform.