Powder metallurgy precision parts manufactured through pressing and sintering are increasingly being used for highly loaded applications e.g. in automotive engines and transmissions. In order to withstand the loading, optimum mechanical proper-ties have to be attained which necessitates improvement both of materials and of manufacturing techniques, however without compromising the dimensional precision. Here, special compacting techniques are described which result in better relative density and lower porosity; however it is shown that the optimum mechanical properties are attained only if the compacting technique is combined with sufficiently intense sintering. The results presented indicate that the load bearing cross section, i.e. the total area of sintering contacts, controls the strength and not so much the relative density. Significant progress can also be gained by using new compositions, esp. Cr alloy steels prepared from prealloyed powders. In this case, the role of the sintering temperature is particularly important since the more stable oxide layers covering Cr steel particles compared to unalloyed steels or Mo alloyed ones are reduced at markedly higher temperatures. If combining the optimised manufacturing techniques with the new material systems, very promising sintered steels can be obtained.