The present study is made to develop ultra fine grained microstructure in welded steel tubes, through multiple cold drawing passes followed by an annealing treatment. The average ferrite grain size is reduced from 16 to 1.9 μm. SAE 1019M steel grade used for a typical automotive driveline component is studied. Strains between 0.3 and 1.4 followed by annealing at 400, 450 and 500 °C are considered to optimize the combination of cold drawing strain and temperature required to produce ultra fine grained microstructure in steel tubes. At a strain value of 1.4 and annealing temperature, 500 °C, polygonal ferrite grains and fine carbide particles are obtained. This microstructure is found to be suitable owing to its combination of high strength and good ductility in steel tubes. Tensile strength as high as 1,061 MPa and 9 % elongation is obtained due to microstructural refinement. The strength is increased by 350 MPa compared to the strength of conventional cold-drawn welded tubes. © 2014, Indian Institute of Metals.