A shape memory alloy with the chemical composition Fe-14Mn-6Si-9Cr-5Ni (mass %) was produced by powder metallurgy (PM) from as-blended powders mixed with mechanically alloyed (MA'ed) powder volumes in amounts of 0, 10 and 20. After powder blending, pressing and sintering, the specimens were hot-rolled, spark erosion cut with different configurations and solution-treated between 700 and 1100 degrees C. After metallographic preparation, structural analyses were performed by X-ray diffraction and microscopic observation performed by optical and scanning electron microscopy (SEM). The analyses revealed the presence of thermal- and stress-induced martensites caused by solution treatment and pre-straining. Due to the relatively low Mn amount, significant quantities of alpha ' body center cubic martensite were formed during post-solution treatment water cooling. Solution-treated lamellar specimens underwent a training thermomechanical treatment comprising repeated cycles of room temperature bending, heating and sputtered water cooling. By cinematographic analysis, the occurrence of the shape memory effect (SME) was revealed, in spite of the large amount of alpha ' bcc martensite. Tensile specimens were subjected to room temperature failure tests and pre-straining (up to 4% permanent strain, after loading-unloading). After tensile pre-straining, a diminution of alpha ' martensite amount was noticed on XRD patterns, which was associated with the formation of internal sub-bands in the substructure of martensite and were observed by high-resolution SEM. These results prove that SME can be obtained in trained PM_MA'ed Fe-14Mn-6Si-9Cr-5Ni specimens in spite of the large amount of thermally induced alpha ' bcc martensite, the stress-induced formation of which is impeded by the presence of internal sub-bands.