In the present work, a novel medium carbon martensitic stainless steel (MCMSS) with an excellent combination of strength, ductility, and impact toughness was designed on the basis of quenching-tempering and partitioning (Q–T&P) technology. Q–T&P is an identical heat treatment with a standard quenching and tempering (Q–T) process but has the same role with quenching and partitioning (Q&P) on microstructure control, i.e., promoting carbon-rich retained austenite via inhibiting carbide precipitation. Results show that, without compromise on strength, the total elongation and room temperature impact toughness, i.e., 9.6 pct and 90 J cm−2, of the proposed alloy (23Cr13MnSi) increase by 14 and 110 pct, respectively, as compared to those of the commercial AISI 420. The significant improvement of ductility and impact toughness in the proposed alloy is mainly a result of the gradual transformation induced plasticity (TRIP) effects, which are caused by carbon-rich retained austenite with heterogeneous stability and carbide-free martensite formed in the Q–T&P process