The precipitation mechanism of small hafnium carbides in the sintered and thermo-mechanically processed molybdenum based alloy MHC (Mo–0·65Hf– 0·65C (at.-%)) is reported. Light and scanning electron microscopy revealed hafnium oxides, large hafnium carbides and molybdenum carbide layers at the grain boundaries in the as-sintered material. Additionally, atom probe tomography showed a residual dissolved content of 0·12 at.-%Hf, but no carbon in solid solution. After thermo-mechanical processing of the as-sintered material in a deformation dilatometer, transmission electron microscopy revealed small hafnium carbides with diameters of 10–100 nm. These carbides were preferentially located at dislocations and dislocation networks. Without deformation prior to aging, no formation of small hafnium carbides was observed. X-ray diffraction confirmed that decomposition of molybdenum carbides had occurred, which delivered the carbon for the formation of strain induced precipitates.