The effects of the Y- and Ti-containing inclusions on the tensile and impact properties of reduced activation ferritic martensitic (RAFM) steels were evaluated. Four steels with different Y and Ti contents were produced via vacuum induction melting. The size and quantity of inclusions in the steels were analyzed using scanning electron microscopy, and the oxide particle formation mechanism was clarified. These inclusions helped to enhance the pinning effect of the austenite grain boundaries based on the Zener pinning force. The average prior austenite grain sizes, measured via the linear intercept method, were 12.34 (0 wt.% Ti), 9.35 (0.010 wt.% Ti), 10.22 (0.030 wt.% Ti), and 11.83 (0.050 wt.% Ti) μm for the four steels, in order of increasing Ti content, respectively. Transmission electron microscopy was conducted to observe the fine carbides. The strength and impact properties of the steel containing 0.010 wt.% Ti were improved, and the ductile-to-brittle-transition temperature was reduced to −70.5 °C. The tensile strength and impact toughness of the steel with 0.050 wt.% Ti were significantly reduced due to the coarsening of both the inclusions and grain size, as well as the precipitation of large TiN inclusions. The RAFM steel with approximately 0.015 wt.% Y and 0.010 wt.% Ti exhibited an optimized combination of microstructures, tensile properties, and impact properties among the four steels.