Abstract: In order to study the mechanism of microstructure refinement and the second phase particle precipitation of magnesium treated ship plate steel during thermal cycling, the dynamic in situ observation of the microstructure change of magnesium treated ship plate steel during thermal cycling was carried out by high temperature laser confocal microscope (CLSM). The inclusion evolution rule of IAF at different cooling rates was studied by scanning electron microscopy (SEM), energy dispersive spectroscopy(EDS) and optical microscopy(OM). The nucleation mechanism of IAF on inclusions was analyzed from the angle of misfit degree. The results show that the pinning particles can effectively restrain the austenite grain coarsening under the experimental conditions, and the inclusions can induce IAF and effectively refine the microstructure at the cooling stage. As for the experimental steel, the effect of inclusion on IAF is the best when the cooling rate is 5℃/s. The core of the inclusion that can induce IAF is formed during deoxidation and alloying of liquid steel, and the MnS on the surface of the inclusion is secondary precipitated and adhered to the surface of the compound inclusions during the welding thermal cycle, the results of SEM analysis of the inclusions are also verified theoretically.