The microstructure and precipitates of a novel nickel-based powder metallurgy (P/M) superalloy FGH98 I in subsolvus and supersolvus heat treatment condition was studied by means of thermodynamic calculation, OM, FESEM and chemical phase analysis. The relationship between microstructure and mechanical properties was also analyzed. The results show that the precipitates of the alloy FGH98 I heat treated at 1130 oC and 1190 oC are γ′, MC, M23C6 and M3B2, without the observation of TCP phases. The grains of subsolvus heat treated FGH98 I grow slightly, and there are primary, secondary and tertiary γ′ phases with different sizes. The grains of supersolvus heat treated FGH98 I grow significantly, and the alloy has monomodal γ′ precipitate distribution. The former has higher strength because of finer grains, while the latter has improved high temperature ductility and stress rupture properties due to the reduced size of secondary γ′ phases and the elimination of primary γ′ phases, PPB (prior particle boundary) and residual dendrite structure. It reveals that the different grain sizes and γ′ characteristics are the key factors for dual-property FGH98 I disk