The existence and formation of expanded austenite in ferritic stainless steels remains a subject of debate. This research article aims to provide comprehensive insights into the formation and decomposition of expanded austenite through in situ structure analyses during thermal treatments of ferritic steels. To achieve this objective, we employed the Plasma Immersion Ion Implantation (PIII) technique for nitriding in conjunction with in situ synchrotron X-ray diffraction (ISS-XRD) for microstructural analyses during the thermal treatment of the samples. The PIII was carried out at a low temperature (300–400 °C) to promote the formation of metastable phases. The ISS-XRD analyses were carried out at 450 °C, which is in the working temperature range of the ferritic steel UNS S44400, which has applications, for instance, in the coating of petroleum distillation towers. Nitrogen-expanded ferrite (αN) and nitrogen-expanded austenite (γN) metastable phases were formed by nitriding in the modified layers. The production of the αN or γN phase in a ferritic matrix during nitriding has a direct relationship with the nitrogen concentration attained on the treated surfaces, which depends on the ion fluence imposed during the PIII treatment. During the thermal evolution of crystallographic phase analyses by ISS-XRD, after nitriding, structure evolution occurs mainly by nitrogen diffusion. In the nitrided samples prepared under the highest ion fluences—longer treatment times and frequencies (PIII 300 °C 6 h and PIII 400 °C 3 h) containing a significant amount of γN—a transition from the γN phase to the α and CrN phases and the formation of oxides occurred.