Secondary-phase fillers usually strengthen metals at the expense of plasticity and functionality. Here we show that embedding stimulus-responsive, shape-memory ceramics into a metal activates a transformation-induced plasticity (TRIP) response through a distinct constraint-relief mechanism. During processing, matrix constraint stabilizes metastable austenite in ceramics; during deformation, progressive local stress relief drives the free-energy change negative and triggers martensitic transformation inside the metal. As a proof of concept, aluminum (Al) containing 20 wt.% transformable zirconia exhibits a twofold increase in uniform elongation vis-à-vis Al with non-transformable zirconia, together with an ultimate tensile strength about 50% higher than monolithic Al. The transformation-induced lattice expansion promotes dislocation storage, sustains strain hardening, and suppresses crack initiation, thereby delaying strain localization. These results establish ceramic phase transformation in metals as a new route to plasticize, strengthen, and functionalize structural alloys.