In micro cold forming, the tools are loaded differently in various functional areas, and tailored material properties are therefore required. To meet this requirement, different tool steels can be applied in the specific regions of the tools, with a gradual material transition in between to ensure a good bonding. These kinds of composite material can be produced via two newly developed material manufacturing processes: co-spray forming and successive spray forming. The spray-formed materials have been hot formed to eliminate porosity and break up the carbide network. Moreover, a selective heat treatment based on middle frequency induction heating has been developed to simultaneously austenitize the tool steels at different temperatures since the different steels may require different heat treatment conditions. Finally, micro rotary swaging tools made of graded tool steels have been precisely machined in hardened condition due to the fine and homogeneous microstructure in the steels. The tools have been successfully applied to form wires of AISI 304 stainless steel.