In this study, the microstructure and mechanical properties, especially the impacts of low-temperature tempering, of the medium-Mn martensitic steel were examined. The low-temperature tempering simulated paint baking in car manufacturing. Significant improvement of tensile ductility was achieved by baking, associating with a change from brittle to ductile fracture behavior. The ductilization was attributed to the carbon re-distribution during baking, as allowed by the high volume fraction of retained austenite (15 pct). The carbon distribution was characterized by Atom Probe Tomography. The baked medium-Mn martensitic steel presents an excellent strength–ductility combination, which is a promising candidate as next-generation high-performance steels for vehicle lightweighting.