T8 steel surfaces were treated by pulse detonation-plasma technology (PDT) at capacitance values of 600, 800, and 1000 μF, and the effects of PDT were analyzed using x-ray diffraction, scanning electron microscopy, transmission electron microscopy, electron back-scattered diffraction, and micro-hardness tester and friction wear tester. The surface of T8 steel is first smoothed out, and then, craters are formed due to the inhomogeneity of the PDT energy and targeting during PDT treatment. The initial martensite in the T8 steel surface layer changes to austenite, and Fe3N is formed due to nitriding. The thickness of the modified layer, which is composed of columnar and fine grain structures, increases with the increasing capacity. Preferential orientation occurred in the {110} 〈 001 〉 direction in the modified layer, and the number of low-angle grain boundaries increased significantly after PDT treatment. The micro-hardness and wear resistance of the T8 steel was improved by PDT treatment, even doubled after the treatment with the capacitance of 1000 μF.