Low carbon TRIP steel shows quite complicated deformation behavior. The main purpose of this study is to clarify the deformation mechanism of low carbon TRIP steel by using a numerical simulation method. According to research works in the past, continuous transformation of retained austenitic phase is essential in order that TRIP steel may show favorable ductility, which implies that appropriate control of martensitic transformation is most important for improvement of ductility. Therefore, we built models for deformation-induced martensitic transformation and performed FEM analysis using homogenization method accounting for the chemical composition, temperature, and crystal orientation. As a result, the effects of chemical composition, temperature, and crystal orientation on the deformation and transformation behavior of low carbon TRIP steel were clarified quantitatively and the conditions to realize improved ductility in TRIP steel were suggested.