In order to control the machinability and mechanical property of resulfurized free-cutting steel, the high temperature experiments at laboratory and thermodynamic analysis were carried out to investigate the formation and evolution of inclusions in the processes of refining and solidification. Furthermore, the migration behavior of sulfur was also assessed between the inclusions and the liquid steel. The results showed that the liquid oxysulfide inclusion (Mn,Si)x(O,S)y with trace amount of sulfur formed after FeS addition at 1600°C. As sulfur segregated in the residual liquid steel during solidification, sulfur rapidly migrated into (Mn,Si)x(O,S)y from the liquid steel at the initial stage of solidification. However, sulfur migrated out from (Mn,Si)x(O,S)y at the middle stage of solidification because MnS precipitated from the supersaturated liquid steel. After the steel solidified completely, sulfur continued to migrate out from the liquid oxysulfide inclusion (Mn,Si)x(O,S)y. When the temperature decreased to 1250°C, the liquid inclusion (Mn,Si)x(O,S)y transformed to two solid phases of (Mn,Si)xOy and MnS. Finally, the complex inclusion composed of (Mn,Si)xOy and MnS formed.