The 17–4 precipitation-hardened (PH) alloy can be printed into diverse microstructures. Existing reports on the alloy have focused on the effect of Creq/Nieq ratios and the processing parameters of laser powder bed fusion (LPBF) on the final microstructures of the δ-ferrite and α’-martensite phases in the alloy. However, the effect of microstructural variations on the residual stress field of LPBFed 17–4 PH stainless steel has not yet been investigated. This study bridges the gap between what is known about the microstructure and residual stresses by proposing an alloy-equivalent phase prediction diagram for the additive manufacturing of the 17–4 PH alloy by varying the Creq/Nieq ratio and volumetric energy density to control residual stresses via microstructure manipulation. Dilatometry and Satoh tests were performed to elucidate the mechanism of the offset effect in martensite transformation. To control the microstructures, samples were fabricated with various Creq/Nieq ratios (2.05, 2.15, 2.30, and 2.49) and laser powers (130, 150, 170, and 190 W). The 17–4 PH alloy exhibited a low Ms temperature and approximately net zero residual stresses in the Satoh test. The study confirmed that martensitic transformation, which occurs more readily at lower Creq/Nieq ratios and higher laser powers, effectively offsets tensile residual stresses during the LPBF process.