Molecular dynamics simulations were employed to study the deformation behavior and microstructure evolution of nanocrystalline iron alloy during vibration-assisted scratching. The mechanical properties of the plastic deformation layer after scratching were tested by uniaxial tension. The results show that dislocation multiplication and twinning occur sequentially during loading, while dislocation rebound and detwinning occur during unloading. High stress induces dislocation multiplication. High strain rate facilitates the formation of deformation twins. Under the inhibitory effect of deformation twins on dislocation activity and the elastic recovery of the surface, dislocation density decreases with increasing frequency but initially increases and decreases with increasing amplitude. The plastic deformation layer at 10 GHz frequency and 1 nm amplitude exhibits optimal yield strength due to dislocation and nanotwin strengthening.