In this paper, the surface modification of AISI 1045 steel by a hollow cathode discharge (HCD) based pulsed electron beam and the formation of the surface microstructure via a short time duration of the pulsed beam treatment are the main focus under investigation. The electron beam in our work is generated by a compact HCD electron beam device named pseudospark discharge, which is characterized by the fast plasma ignition and quenching rates. And the surface microstructure, composition and microstructure crystallographic information of AISI 1045 steel pre and post pseudospark based pulsed electron beam modification are investigated by using metallographic microscope, scanning electron microscope (SEM), X ray diffraction (XRD) and Electron Back Scatter Diffraction Patterns (EBSD). The experimental results demonstrate that a microstructure consisting of cementite and C-supersaturated austenite is formed in the near-surface region after the pseudospark based pulsed electron beam irradiation. Both the phenomenon of the metal target grain refinement and the mechanism of the grain refinement evolution are investigated by a diversity of diagnostic methods. It is also showed that the material surface modification process is highly dependent on the transient properties of the HCD-based pulsed electron beams, which offers a new and effective method to improve the performances of the metallic material surface microstructure and other properties.