In-depth microstructural characterization and structure–property correlations with the number of cycles of the cyclic heat treatment (CHT) were investigated after conducting CHT at 850 °C for 3, 5, 7, and 9 cycles. Each cycle of the CHT involves heating to 850 °C at 5°/s, soaking for 5 min, and then cooling to 0 °C at 50°/s. Due to the short duration holding, some martensite remained incompletely dissolved at the interface of delta ferrite and martensite matrix which was observed as partially dissolved martensite (PDM). The dissolution and fragmentation of delta ferrite reduced its size and the fraction from the microstructure. The reduced delta ferrite in the microstructure increased the tensile strengths significantly but it deteriorated the tensile strengths on the further reduction of its content beyond 9.5%. The increased microhardness of the martensite phase in the treated specimens was predominantly attributed to the increased dislocation densities. The treated specimens were observed to have 67% higher slurry erosion resistance due to their better combination of hardness and tensile toughness. The material from the treated specimens was removed by ploughing, craters, pull-outs, and microcutting which characterizes a mixed ductile–brittle mode of erosion.