The deformation mechanisms of a novel medium Mn steel (Fe–0.14C–7.8Mn–1.65Al–0.11Zr, wt%) were investigated through mixed multiphase preservation-intercritical annealing route. A heterogeneous duplex microstructure consisting of plate-like and equiaxed austenite and ferrite with multiple morphologies and multiscale and Mn inhomogeneous distribution was obtained after intercritical annealing at 680 °C for 10 min. The heterostructured sample exhibited excellent strength–ductility synergy with a yield strength of 1022 MPa, an ultimate tensile strength of 1280 MPa, and a total elongation of 53%. Comparative analysis revealed that hetero-deformation-induced (HDI) stress was generated during tensile deformation. This stress was primarily responsible for the superhigh yield strength of the heterostructured sample. In addition, the HDI stress could initially trigger premature martensitic transformation of austenite in the grain or phase boundary region and delay the martensite transformation of untransformed austenite to a large strain range due to the shielding effect of the formed core–shell structure, which comprised an untransformed core austenite and a shell α'-martensite. Multiple strengthening and ductility-enhancing mechanisms involving transformation-induced plasticity effect, twin-induced plasticity effect, HDI synergistic hardening, and dislocation strengthening occurred sequentially during deformation, leading to the extraordinary strength–ductility combination of the heterostructured medium Mn steel.