The feasibility of using friction stir-processing technique as a microstructural refining method for preventing hydrogen-induced blisters of SK4 carbon steel alloy containing microstructure of hard cementite particles in a ductile ferrite matrix was examined. Amount and size of hydrogen-induced blisters decreased in the stirred layers with increasing rotation speed and completely disappeared when rotation speed attained 400 rpm because of the formation of a hard and fine microstructure consisting of pearlite, martensite, and retained austenite instead of that containing hard spheroidized cementite particles in a soft ferrite matrix. Interfaces between ferrite matrix and cementite particles were the preferential sites for the hydrogen blisters initiation.