The hot deformation behavior and microstructure evolution of Fe-Mn-Al-C steel, which has lamellar ferrite and equal axial shape austenite heterostructures, were studied using the thermal compression test. This test was conducted at temperatures ranging from 800° to 1000°C and a strain rate ranging from 0.01 to 101 s−1. The thermal deformation constitutive relationship of the steel was established, and the rheological behavior of the steel is quantitatively discussed. In contrast, the thermal processing diagram has been established, and the thermal processing parameters have been optimized. In addition, the flow behavior, mechanical properties, and microstructural evolutions of steel at different temperatures and a high strain rate 101 s−1 comparable to that during hot processing (rolling and forging) were mainly focused. The steel exhibits superior peak strengths at different temperatures compared to other traditional steels, the maximum compression strength of 533 MPa was achieved at 800 ℃− 10 s−1. In the unstable zone of the processing map, the ferrite and the austenite exhibit distinct hot deformation behavior, leading to inhomogeneous deformation. With increasing temperature, the instable, critical, and stable zones appear successively. Austenite deformation is increasingly influenced by dynamic recrystallization (DRX), while a gradual transition from dynamic recovery to DRX occurred to undertake the deformation of ferrite. The optimized processing condition for austenite-ferrite heterostructured steel is mainly at a temperature of 900–1000 ℃ with a strain rate of 0.01–0.1 s−1.