Here we report a microstructural design in maraging steel, which renders superior strength-ductility synergy by combining the advantages of transformation induced plasticity and dislocation cutting mechanisms, via an economic thermomechanical route suitable for industrial scale. It aims at innovating ductile maraging steel without conceding too much strength. Specifically, a high-strength maraging steel is first treated by cold-rolling and intercritical annealing, which leads to partial retransformation and precipitation of supersaturated needlelike/near-spherical B2-structured nanoparticles occurring simultaneously in dislocated α′-martensite matrix. The material is further optimized by peak-aging, yielding a desired microstructure, with nanosized γ-austenite (d‾γ ∼150 nm) dispersed in lath α′-martensite (d‾α′ ∼130 nm) with dense spherical B2-nanoprecipitates (d‾B2 ∼6.5 nm), i.e., an austenite-maraging structure with hierarchical heterogeneity at nanoscale. The yield strength is measured to be ∼1.65 GPa, which is largely retained as it combines boundary strengthening, dislocation strengthening and ordering strengthening of nanoprecipitates. Surprisingly, significant work hardening renders an ultimate strength even high up to ∼1.9 GPa and a decent ductility of ∼6–7%, twice that of conventional maraging steels. Interrupted microstructure examination unravels that it is the hierarchical microstructure heterogeneity-induced sequential activation of plasticity-enhancing mechanisms that confers such excellent deformability. At the stage soon after yielding (ε∼1.5–3%), deformation-induced transformation from metastable γ-austenite to α′-martensite imparts a significant strain hardening rate (Θ) up-turning. At the high strain stage (ε>3 %), multiple dislocations cutting through B2-nanoprecipitates promotes the interaction and accumulation of dislocations, thereby postponing Θ attenuation and prolonging ductility.