<p>Precipitation strengthening is a pivotal mechanism for enhancing the mechanical properties of low-density alloys. A detailed analysis of microstructural evolution during thermal processing is imperative to thoroughly understand its strengthening behavior. This study employed the Bähr D805L quenching dilatometer system to study the formation, evolution, and impact on the contribution of nano-precipitates on the mechanical behavior of Fe-21Mn-10Al-5Ni-C (nominal composition) low-density alloy during continuous cooling. The study unveiled the precipitation mechanism of nano-particles within the austenite (γ) matrix at cooling rates in the range of 40–0.1 °C·s⁻¹. Moreover, the addition of Ni in Fe-21Mn-10Al-5Ni-C low-density alloy enhances the atomic size factor, promoting alloy spinodal decomposition and ordering. During slow cooling, B2 phases precipitate along grain boundaries, accompanied by the formation of a precipitation-free zone (PFZ) near the boundaries and the dissolution of some later nucleated small particles. These phenomena are a primary mechanism that suppresses the precipitation of B2 phases within the γ matrix.</p> Graphical abstract <p></p>