Compared to Cr-Ni stainless steel, nickel-saving stainless steel is a low-cost austenitic stainless steel. We studied the deformation mechanism of stainless steel at various annealing temperatures (850 °C, 950 °C, and 1050 °C). The grain size of the specimen increases with increasing annealing temperature while the yield strength decreases, which follows the Hall–Petch equation. When plastic deformation occurs, dislocation increases. However, the deformation mechanisms can vary between different specimens. Stainless steel with smaller grains is more likely to transform into martensite when deformed. While twinning occurs when the grains are more prominent, the deformation results in twinning. The phase transformation during plastic deformation relies on the shear, so the orientation of the grains is relevant before and after plastic deformation.