We report on the evaluation of thermal degradation damage in metal material using the nonlinear effect of Lamb wave propagation. A mountain-shape change in the second harmonic of Lamb wave propagation versus the level of thermal degradation in the specimens is observed. It is attributed to the precipitations in the early stage and the microvoids after long-term service in terms of metallographic studies. The results show that the nonlinear Lamb wave is very sensitive to the microstructure evolution and is a good potential for quantitative evaluation of the thermal damaged materials.