To study the cold-forming effect on the yield strength distribution of cold-formed thick-walled steel, material tensile tests and axial compression tests were conducted on steel-lipped channels. To undertake the material tensile tests, five types of cold-formed lipped channel sections with varied thicknesses and nominal yield strengths were selected. The material test samples were taken from the web, flange, curled edge, and corner of the lipped channel sections, respectively. Next, a corresponding distribution model for the yield strength of cold-formed thick-walled lipped channel sections was developed. Following this, axial compression tests of five short columns with the same section as the coupon tests were conducted to further investigate the cold-forming effect. Finally, the results from the short column tests, the results based on the proposed yield strength distribution model, and the results calculated for related codes in various countries were compared. These revealed that the yield strength distribution, bearing capacity, and ductility were considerably influenced by the cold-forming effect and mainly depended on the width-to-thickness ratio (h/t) of the plate involved. When h/t was less than 34, the curve slowly decreased after reaching the peak load and had good ductility. Conversely, when h/t was greater than 71, local buckling had an obvious influence on the bearing capacity of the specimen, and the column ductility was poor. Overall, the results based on the Chinese code GB 50018-2002 were closest to the experimental values with the smallest variation coefficient, and therefore this code has the best applicability.