We reports the damping properties of an Fe-23%Mn alloy with various amounts of thermal or deformation-induced ε martensite. By controlling cooling temperatures and cold rolling degrees, the volume fractions of thermal and deformation-induced ε martensites are changed from 33 to 50% and from 33 to 75%, respectively. The damping capacity of the Fe-23%Mn alloy increases with an increase in thermal ε martensite content, whereas the damping capacity associated with deformation-induced ε martensite shows a peak value at 57% of ε martensite. Transmission electron micrographs on deformed samples reveal that the decay of damping over 57% of deformation-induced ε martensite is caused by an introduction of perfect dislocations, which play a role in suppressing the movement of damping sources. For the same amount of ε martensite, deformation-induced ε martensite exhibits higher level of damping capacity than thermal ε martensite. This may well be owing to relatively greater length of γ/ε interfaces in response to higher number density of ε martensite plates.