Product development routes for new generation ultrahigh-strength structural steels such as S1300 are currently not well-defined, warranting studies on their alloy design, processing, and microstructure–property correlations. This study aims to bridge the gap in understanding of these aspects by investigating a boron-treated, low-carbon, S1300-type alloy steel produced via the direct-quench and tempering (DQ&T) route. The study includes detailed characterization of microstructure development under widely varied tempering temperatures using scanning electron microscopy (SEM), electron backscatter diffraction (EBSD), X-ray diffraction (XRD), dilatometry, and hardness measurements. It reveals three tempering stages of martensite, based on changes in hardness and corroborated by full width at half maximum (FWHM), microstrain, crystallite size, and lattice distortion of martensite. A strong linear correlation between hardness and FWHM is found. The microstructure remained predominantly martensitic (BCT) from its DQ to all tempered states up to 700 °C. Furthermore, EBSD analysis reveals the presence of bainite alongside tempered martensite. Nucleation of fine η-Fe2C, formation and growth of Fe3C and other alloy carbides, and secondary hardening are responsible for the three distinct stages of tempering. Finally, a new parameter named “microstrain-crystallite size parameter” is proposed to establish an empirical relationship for predicting hardness changes during tempering of S1300-type steels.