A 0.45% C steel was deformed in torsion over the temperature range 762-872°C in a 5%H2-Ar gas atmosphere. Strains of 0.25-3.0 were applied at a strain rate of ε. = 4 s-1. The experimental parameters were varied in order to study the effects of strain and temperature on the formation of ferrite by dynamic transformation (DT) at temperatures above the Ae3. The critical strain for ferrite formation by DT was about 0.2 and its volume fraction increased with strain. The average ferrite grain sizes were about 1 to 2 µm and were fairly independent of temperature. It was observed that the deformation-induced ferrite remained fairly stable during 800 s of isothermal holding. In general, the experiments showed that DT takes place at temperatures above the Ae3 and that the reverse static transformation is much slower than the forward dynamic transformation.