The influence of continuous annealing variables on the microstructure and mechanical properties of a C-Mn Dual Phase (DP) steel was studied. The annealing cycles were simulated using a Gleeble machine. Some specimens were quenched at different stages of the annealing cycle in order to evaluate the microstructural evolution during the annealing process. Tensile tests and microstrutural analysis were carried out. The results showed that high heating rates increased the final recrystallization temperature and as a consequence the microstructure obtained was refined. Austenite grain nucleation and growth were also influenced by the heating rates. Soaking temperature was the most influent variable on the mechanical properties, i. e., the yield strength increased and the tensile strength decreased with an increase in the soaking temperature. Microstructural analysis showed that not only martensite, but also bainite and martensite-retained autenite constituent (MA) were formed. Undissolved carbides were also detected by transmission electron microscopy.