In the present work, austenitic stainless steel (ASS) 304 foils with a thickness of 50 µm were first annealed at temperatures ranging from 700 to 1100 ℃ for 1 h to obtain different microstructural characteristics. Then the effects of microstructural characteristics on the formability of ASS 304 foils and the quality of drawn cups using micro deep drawing (MDD) were studied, and the mechanism involved was discussed. The results show that the as-received ASS 304 foil has a poor formability and cannot be used to form a cup using MDD. Serious wrinkling problem occurs on the drawn cup, and the height profile distribution on the mouth and the symmetry of the drawn cup is quite non-uniform when the annealing temperature is 700 ℃. At annealing temperatures of 900 and 950 ℃, the drawn cups are both characterized with very few wrinkles, and the distribution of height profile, symmetry and mouth thickness are uniform on the mouths of the drawn cups. The wrinkling becomes increasingly significant with a further increase of annealing temperature from 950 to 1100 ℃. The optimal annealing temperatures obtained in this study are 900 and 950 ℃ for reducing the generation of wrinkling, and therefore improving the quality of drawn cups. With non-optimized microstructure, the distribution of the compressive stress in the circumferential direction of the drawn foils becomes inhomogeneous, which is thought to be the cause of the occurrence of localized deformation till wrinkling during MDD.