In this work, first-principles calculations were used to investigate the effects of the common elements in steel on the solid solution of rare earth Ce in steel, and the effects of Ce on the mechanical properties and electronic structure of the doped system were analyzed. The calculated results of the formation enthalpy show that Ce can be solubilized in γ-Fe, and Cr, Ni, Cu, Nb, Mo, and W have negative effects on Ce solubility, while Si, V, Ti, Al, and Mn promote Ce solubility with the strongest effects from Si and the weakest from Mn. The elastic modulus calculated results show that Ce doping reduces the incompressibility, rigidity and hardness of the system, but the toughness and machinability are improved. Density of states shows that the interaction between Fe–Ce and Si–Ce is strong, while there are almost no interactions in Mn–Ce. A combination of Bader charge and differential charge density analysis shows that the strength of metallic bond of Fe–Ce system is weaker than that of the pure Fe system, which is the main reason for the decrease in incompressibility, rigidity, and hardness of the doped system; the higher electron cloud density of the doped system is the main reason for its increase in toughness. Furthermore, with the strong interaction between Si and Ce, and Si can effectively reduce the lattice distortion caused by the solid solution of Ce, which are the two main reasons why Si significantly increases the solid solution of Ce.