Lath martensite transformation in low carbon steel relates to the discontinuity of the transformation rate, which exhibits a series of martensite transformation rate maxima (peaks), especially in low cooling rates. In the present work, we put an emphasis on the influence of annealing twins in parent austenite grains (PAGs) and cooling rates on the discontinuity of lath martensite transformation rate in a low carbon reduced activation ferritic/martensitic (RAFM) steel. Lath martensite microstructure is hierarchical and the lath martensite transformation rate peaks are hierarchical during the cooling process. If the cooling rate was not high enough, the lath martensite transformation rate peaks will be divided into two groups by annealing twins in parent austenite. These transformation rate peaks in the first group were mainly caused by lath martensite transformation in the non–twin zones in the PAGs. Then, the second group mainly consisted of a single transformation rate peak, which was primarily caused by the martensite transformation in the twin zones in the PAGs. In the present work, a new “localized stress field” theory is proposed and successfully used for interpreting the classification mechanism of lath martensite transformation rate peaks and the evolution of these peaks with changing cooling rate.