It is challenging to simultaneously increase strength and decrease modulus, since they are often mutually exclusive. Here, we report an easy way to achieve a 140% increase of yield stress and a 59% decrease of Young's modulus in a shape memory alloy of Ti49.2Ni50.8 via tensile plastic deformation at T0(σ) ∼283 K (T0(σ) denotes an equilibrium temperature between austenite and martensite after deformation). Through integrating experiments and Landau theory, we reveal that besides the strength increase due to strain hardening, the modulus reduction results from a state change from an austenitic state to a special dual-phase state where austenite and stress-induced martensite have the same free energy and thus exhibit the lowest modulus at T0(σ). Similar results were also found in another ferroelastic Ti49Ni51 alloy, implying that the performance of other ferroelastic materials may be further optimized using the strategy of plastic deformation at T0(σ).