Introduction of compressive residual stresses on the fatigue-loaded components is one of the techniques followed to improve the fatigue life of industrial components. Oil jet peening is a surface modification process for the introduction of compressive residual stresses. A high-pressure oil jet is made to impinge on the surface to be peened. Preliminary studies were carried out on the medium carbon steel at the oil pressure of 50MPa. The compressive residual stress induced on the surface of unpeened and oil jet-peened AISI 1040 steel was 21MPa and 200MPa, respectively. Fully reversed cantilever bending fatigue behaviors of medium carbon steel in both under peened and unpeened conditions were evaluated at room temperature. Oil jet-peened specimens exhibited superior fatigue performance compared to the unpeened specimens. Fractographical analyses were carried out for specimens broken at several tested stress levels using optical microscope.