It is well known that fatigue strength of welded joints does not depend on steel strength. Better fatigue strength of welded joints, e.g. longer life time of fatigue loaded weld structures, can be achieved with a smooth transition between the weld and the base material to minimize stress concentration. It has also been recognized that residual stresses play a critical role in the fatigue behaviour of welds. In the last decade an extensive research has been performed in order to increase the fatigue strength of high strength steel weldments. The martensite and bainite transformation start temperatures of weld metals have been shown to have a large effect on fatigue life time of high strength steel welds. This is of particular importance if the full potential of high strength steels is to be used in fatigue loaded constructions. A detailed investigation of the effect of phase transformation temperature on residual stress distribution in the vicinity high strength steel welds and its effect on fatigue life time has been performed. The transformation temperature of the weld metal was varied by changing the chemical composition of the filler material. Residual stress distributions have been measured by neutron as well as by X-ray diffraction and fatigue tests have been performed on the fillet welds. A strong effect of weld metal phase transformation temperature on residual stress level was observed. Fatigue strength increased approximately three times when an optimised low transformation temperature filler material was used in comparison to the application of conventional filler material