A criterion for predicting the workability limits for internal brittle failure was developed for cold-heading of 1038 steel. The criterion considers internal defects caused by the transformed adiabatic shear band (TASB) phenomena. The defect that develops is the formation of brittle martensite as a result of phase transformation due to the temperature rise inside the adiabatic shear band (ASB). In this work, the material is considered to have a TASB defect when the temperature inside the ASB exceeds the phase transformation temperature (AC3). The empirical formulas provided by Andrews  were used to determine transformation temperatures. In addition, microhardness testing and etching with 2% Nital and Le Pera etchants were performed on the sectioned specimens to locate and study the TASB. In order to simulate the cold heading process a drop weight compression test was used along with finite element analysis (implemented within ABAQUS/Explicit).