AbstractCLAM steel is one of the structural material used in test blanket modules as a barrier or blanket for fusion reactors. Different diffusion annealing processes were employed in order to investigate the effect of δ-ferrite elimination and prior austenite grain coarsening. The results show that both alloying elements diffusion and microstructures coarsening during the diffusion annealing treatment influence the contents and morphologies of δ-ferrite. The polygonal blocky δ-ferrite and the coarse grains were determined as the main factors deteriorating the impact toughness for the CLAM welded joint. A CLAM welded joint with good impact toughness and appropriate microstructure in terms of grain size and δ-ferrite content was obtained after diffusion annealing process at 1100 °C for 10 h.