In comparison with austenitic stainless steel, the ferritic stainless steel has obvious advantage in price due to its lower nickel content. However, the relatively poor ductility and toughness limit its applications. To overcome these shortcomings, a new thermo–mechanical approach, involving processing by severe plastic deformation and proper annealing treatment to introduce a bimodal grain size distribution, was adopted for achieving high work–hardening capability, superior strength–ductility combination and good impact toughness in metallic materials. In this work, the combined effects of severe plastic deformation and partially recrystallization on the microstructures and mechanical properties of a ferritic stainless steel were investigated and compared with the traditional forging and annealing process. An solution–treated ferritic stainless steel (0Cr13, AISI 405) was subjected to equal–channel angular pressing (ECAP, an important kind of severe plastic deformation) for two passes at room temperature and subsequent annealing treatments. Optical microscope (OM) and transmission electron microscopy (TEM) observations showed that ultrafine-grained (UFG) structure was obtained in the ECAP–processed sample. After subsequent annealing at 650—750 ℃ for 1 h, partial recrystallization occurred and the remaining island–like UFG grains (10%—35% volume fraction) distributed uniformly. Statistical measurements indicated that the microstructures of the annealed ECAP samples exhibited a bimodal grain size distribution including relatively coarse recrystallized grains (CRGs) and remaining ultrafine grains (UFGs). The average grain size for CRGs determined from OM observations was 5.1—8.3 μm and the average grain size for UFGs measured from TEM observations was 418—525 nm. By contrast, the annealed forged sample (700℃) exhibited a unimodal grain size distribution with average grain size of about 74 μm. Tensile and impact tests showed that the strength of 0Cr13 ferritic stainless steel could be improved greatly through grain refinement by ECAP process, and the strength–ductility combination could be modulated via sacrificing some strength for ductility by subsequent annealing treatment. In comparison with the conventional sample (forging+annealing at 700 ℃), the tested steel processed by the optimal processing involving ECAP deformation and annealing treatment at 700℃ showed higher yield strength, uniform ductility and static toughness (enhanced by 10%, 35% and 70% respectively), simultaneously a comparable impact toughness (212 J/cm²). The refined microstructure and higher work–hardening capacity were responsible for the improved mechanical properties of the annealed ECAP samples and the strengthening mechanisms were discussed based on the experimental results.