The mechanical properties of sinter hardened Astaloy CrM were investigated as a function of post sintering cooling rate. Microstructural changes because of sinter hardening were correlated with tensile and fatigue behaviour to understand the influence of microstructures on mechanical behaviour. Hardness, yield strength, tensile strength and fatigue endurance limit all increased with an increase in cooling rate. The beneficial effect of sinter hardening on mechanical properties could be attributed to a change from a mixed microstructure in the as-sintered condition to a more homogeneous martensitic microstructure in the fully hardened condition. Fractographic studies showed that fatigue crack initiation was facilitated by surface pore clusters which impart high stress concentration at surrounding sintered necks leading to early crack initiation. The implications of microstructural changes because of sinter hardening on strain localisation at sintered necks, fatigue crack initiation behaviour and fatigue ratio of Astaloy CrM powder metallurgy steel are discussed.