The progression of polyacrylonitrile (PAN) fibers on multistage stabilization stage has been monitored by following the variations in density, elemental composition, morphological aspect, and mechanical properties. The effects of various processing conditions during the multistage stabilization on the mechanical properties of final carbon fibers were evaluated in detail. To achieve an optimal extent of stabilization of PAN fibers is critical as the final mechanical properties of carbon fibers are concerned. This aim can be realized by adjusting and matching the temperatures in each step and the processing rates during multistage stabilization. Imposing stretching on multistage stabilization is beneficial to mechanical properties of carbon fibers.