The grain size (GS) effects on stress-assisted two-way memory behavior of NiTi shape memory alloys (SMAs) were investigated by thermomechanical actuation tests over a wide GS range (from 10 nm to 230 nm). The actuation strain and transformation temperatures are observed to decrease monotonically as the GS is reduced, but the transition temperature window is enlarged. The irrecoverable strain decreases monotonically with GS reduction overall. The underlying mechanisms were investigated through microstructural and thermodynamic analysis. It is demonstrated that, as the GS is reduced, the increasing volume fraction of dislocations and grain boundaries (GB) occupying the space of austenite crystallite suppress the phase transition (PT) and lower the entropy change, leading to the decrease of transformation strain. GS reduction converts the PT from first-order type to a continuous one, and greatly expands the operating temperature range of actuation, tuning the discontinuous leap in strain changes into a continuous variation. When GS > 40 nm, transformation induced plasticity dominates the irrecoverable deformation and is monotonically affected by GS dependent hall-patch effect. Further modeling analysis reveals that, the increase in the volume of GB caused by GS reduction drastically modifies the free energy density convexity of the crystallite-GB composite system and leads to the monotonic decrease of transformation temperatures. The near-linear temperature dependency of actuation strain and wider transition temperature window of the nanostructured NiTi, compared to traditional coarse-grained NiTi, provide the opportunity of improved actuation control of SMA actuator and have the potential for some unique applications in the actuation area.