In this paper, the mechanical properties and microstructural evolution of S30432 heat-resistant steel during aging at 650°C were investigated, and the effect of microstructural evolution on the yield strength, tensile strength, hardness and impact toughness was discussed. The results show that, the change of strength and hardness can be divided into three stages. In the first stage (before 500 h), the precipitation of fine ε-Cu plays a main role in the significant increase of the strength and hardness. In the second stage (500–5000 h), the coarsening of ε-Cu is the key factor to decrease the strength and hardness. After 5000 h of aging, there is no obvious change in the strength and hardness. Similarly, the change of impact toughness during aging of S30432 steel at 650°C can also be divided into three stages. The sharp decrease of impact toughness in the first stage results from the precipitation of M
23C
6 and ε-Cu particles. At stage II, the impact toughness keeps on declining as a result of gradual coarsening of M
23C
6, ε-Cu and Nb(C,N). Finally, M
23C
6, ε-Cu and Nb(C, N) are relatively stable, so that the impact toughness tends to be stable gradually.
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