The grinding heat is utilized to induce martensitic phase transformation and strengthen the surface layer of AISI 5140 alloy steel by raising surface temperature higher than austenitic temperature and cooling quickly. The grinding temperature field is simulated by using finite element method (FEM). Then, the hardness penetration depth (HPD) is predicted from the temperature history and martensitic phase transformation conditions in surface grinding. The experiments of different grinding parameters are performed in surface grinding lathe. The hardness and hardness penetration depth of work piece surface layer are measured to validate the simulation and prediction. This method can be used to predict the HPD and optimize the grinding parameters forwardly.