The mechanism of microstructure evolution of 304 stainless steel (SS) during equal-channel angular pressing (ECAP) at 500°C was investigated systematically by optical microscope (OM), transmission electron microscope (TEM) and X-ray diffraction (XRD). The results show that the refining mechanism of microstructure of 304 SS during ECAP behaviors as a hybrid model consisting of dislocation-subdivision mechanism and twin fragmentation mechanism, resulting in three kinds of nanostructure domains: (1) the equiaxial nano-grains with curving grain boundaries (GBs) having high angles of misorientation resulted from the cross-slip and movement of dislocations; (2) the equiaxial nano-grains with smooth and distinct boundaries resulted from the intersection between primary deforming twin bundles; (3) the secondary nano-twins formed in the primary deforming twins. The average nano-grain size ultimately obtained is in the range of 80nm to 120nm and the nano-twins have a width of 20–40nm and a length of 100 to a few hundred nm. A low content about 10% (V/V) of deformation-induced martensite (DIM) is obtained in the first pass and remains almost constant during further passes of ECAP. The refining mechanism of DIM is also a hybrid model, including the refinement of banded DIM by the intersection with slipping bands and the newly induced fine martensite in submicron and nanometer grained austenite matrix.