Based on the principle that the aligned precipitation of second phase can improve shape memory effect (SME), the following effects were investigated, including the effects of different deformation temperatures on the amount and the structure of g /e interface, on the amount and orientation of the second precipitation phase after subsequent aging, and the effects of whick on the martensite transformation and SME. The SEM analysis shows that no g /e interfaces were produced after deformation at the temperature far higher than Ms , and few carbides precipitated after ageing. Much more g /e interfaces were produced after deformation at temperature near Ms , and much more directional carbides precipitated after ageing. With further decreasing the deformation temperature to Ms, some g /e interfaces intersected and carbides precipitated along different directions after ageing. TEM analysis shows that the thick stress-induced martensite plates had the uniform orientation in the 5% preformed alloys with orientationaly precipitated carbides. The reason is that Cr23C6 and strain fields produced by Cr23C6 will restrain martensite transformation and avoid the intersection among martensite plates thus remarkably improve the reversibility of stress-induced martensite.