Multilayer laser powder deposition is being used for the rapid manufacturing of fully dense near net shape components in a wide variety of materials. In this process parts are built by overlapping consecutive layers of a laser melted material. As a result of this overlapping, the material in each layer will undergo successive thermal cycles as new layers are deposited. Despite their short duration, these thermal cycles can activate solid-state transformations that lead to progressive modification of the microstructure and properties of the material. Since the thermal history of the material in the deposited part will differ from point to point, the part will present a complex and heterogeneous microstructure, and properties that differ from point to point. Given that the microstructure and property distribution in steel parts produced by laser powder deposition can only be predicted by modelling, a three-dimensional thermo-kinetic finite element model of laser powder deposition of tool steels was developed. In the present work this model was applied to the study of the influence of substrate size on the microstructure and properties of a six-layer wall of AISI 420 tool steel. The results show that the temperature field depends significantly on the size of the substrate, leading to distinct microstructures and properties in the final part.