In this paper, a low dimensional model is constructed to approximate the nonlinear ferroelastic dynamics involving mechanically and thermally-induced martensite transformations. The dynamics of the first order martensite transformation is first modeled by a set of nonlinear coupled partial differential equations (PDEs), which is obtained by using the modified Ginzburg–Landau theory. The Chebyshev collocation method is employed for the numerical analysis of the PDE model. An extended proper orthogonal decomposition is then carried out to construct a set of empirical orthogonal eigenmodes of the dynamics, with which system characteristics can be optimally approximated (in a specified sense) within a range of different temperatures and under various mechanical and thermal loadings. The performance of the low dimensional model is analyzed numerically. Results on the dynamics involving mechanically and thermally-induced phase transformations and the hysteresis effects induced by such transformations are presented.