This review paper outlines recent progressin the application of rare earth metals (RE)in steel to improve the mechanical propertiesof steel. It includes: the physical chemistryof RE in steel; comparison of the applicationof RE and Ca in steel; the ways of adding REinto steel and nozzle blockage; the solid solubi-lity limit of RE in Fe and the amount of REsoluble in steel; the segregation of RE on grainboundaries of steel and its reaction with otherelements; the effect of RE on the structureand mechanical properties of steels; the reactionof RE with H in steel.