The influence of rare earths (RE) on carbides in high carbon steel weld metal was studied by transmission electron microscope (TEM) and energy dispersive X-ray microanalysis (EDX). It is found that rare earth markedly affects the quantity, morphology and distribution of carbides. The precipitating mechanism of carbides was proposed in which rare earth compounds with high surface energy serve as the nucleation sites for carbides in superheated liquid metal and the induced carbides are precipitated extensively and distributed evenly. The preferential precipitation of carbides decreases the carbon content in matrix, which is transformed into low carbon lath martensite after welds are chilled to room temperature.