We have studied the transformation of carbides in AISI M42 high-speed steels in the temperature window used for forging. The annealing was found to result in the partial transformation of the large, metastable M2C carbides into small, more stable grains of M6C, with an associated change in the crystal orientation. In addition, MC carbides form during the transformation of M2C to M6C. From the high-speed-steel production point of view, it is beneficial to have large, metastable carbides in the cast structure, which later during annealing, before the forging, transform into a structure of polycrystalline carbides. Such carbides can be easily decomposed into several small carbides, which are then randomly distributed in the microstructure. The results also show an interesting difference in the carbide-transformation reactions on the surface versus the bulk of the alloy, which has implications for in-situ studies of bulk phenomena that are based on surface observations.