Examination of the cold worked structure formed in polycrystalline 3 % silicon-iron sheet, by optical and transmission electron microscopy, has shown that the deformation process is inhomogeneous. The dislocations are arranged in dense complex networks, which form boundaries between regions of relatively low dislocation density, the size of these regions decreasing with increasing deformation. Very large deformations result in the formation of discrete subgrains with large misorientations across the subgrain boundaries. Stacking faults occur in 3% silicon-iron on {112} planes, with a stacking fault energy < 40 ergs/cm 2. A correlation of flow stress measurements with dislocation density favours the forest intersection theory of work hardening, although dislocation pile ups have been observed.