The mechanical response of dual phase (DP) steel exhibits a complex dependence on the microstructure. The chemical composition and microstructure characteristics of the phases have significant effects on the contrast between the response of the phases, which affects, not only the strength and ductility, but also the anisotropic response of DP steel under strain path changes. In this work, extended dislocation-based models of the ferrite and martensite phases of DP steel are proposed and used in a finite element based representative volume element approach to account for the contrast between the local response of the phases. The flow stress of each phase is computed as a function of the amount of substitutional and interstitial solute elements and the microstructural characteristics of the phase. Particular attention is paid to the phase model of the martensite phase. The model parameter controlling the storage of dislocations is related to the carbon content, which appears to be the most important parameter affecting the strength of martensite and its contrast with the local response of the ferrite phase. The model predicts a significant effect of the contrast between the local responses of the phases and the microstructure characteristics of each phase on the yield locus after prestraining and on the stress–strain behaviour after strain path change, i.e., forward-reverse shear loading and cyclic uniaxial tension–compression loading.