Transmission electron microscopy (TEM), electron backscatter diffraction (EBSD), and X-ray diffraction analysis are used to monitor the evolution of the microstructure of a microalloyed medium-carbon steel and to evaluate quantitatively the strengthening components and their relative contribution to the yield strength of this steel quenched and tempered at 650 °C. As the duration of isothermal tempering ttem increases from 2 to 3000 min, the steel softens in two stages: a sharp drop of the strength properties, ~100 MPa/min, at stage I (ttem ≤ 8 min) is followed by weak softening, ~0.1 MPa/min at stage II (ttem ≥ 64 min). It is shown that the main contribution ( q ~ 80%) to the yield strength of the steel is made by the combined effect of the dislocation and grain-boundary (due to the lath boundaries) strengthening mechanisms at the first stage of martensite tempering, and by subgrain strengthening at the second stage of tempering.