Effects of transformed ferrite fraction on the mechanical properties of dual-phase steels have been studied on the basis of observation on austenite-to-ferrite transformation behavior during the post-anneal cooling of intercritical annealing. Various fractions of transformed ferrite were obtained by changing the intercritical annealing temperature. As the transformed ferrite fraction was increased up to about 40 percent, ductility of dual-phase steel was improved due to uniform distribution of martensite particles. When the transformed ferrite fraction exceeded the retained ferrite fraction, however, the ductility was deteriorated even with the fine distribution of martensite particles in matrix. The significance of these results is discussed in relation to the austenite-to-ferrite transformation behavior during the intercritical annealing.